HOW IS LOGISTICS MANAGEMENT IMPORTANT TO ANY BUSINESS?
As a customer, when we choose a service provider, we will choose a provider that offers a service that is the best, fastest, most responsive to all your needs and has the best value. As a provider, one must develop their service to offers the best efficiency and effectiveness to respond to client’s needs.
The rules above also apply to ‘logistics service’ (as commonly understood as shipment while an actual meaning is much broader than this definition) as well. In order to improve service quality in logistics service, there must be a good ‘logistics management’. We will introduce you to what logistics management is and how important it is to businesses.
What is the Logistics Management?
Logistics management refers to a process that involves planning, operating and quality and effectiveness control in moving and storing of goods, services and information from a place of origin to its intended destination with customer’s needs in mind.
When we mention logistics management, there is another word that is so similar that is commonly misunderstood of having the same definition. However, their meaning, process and objective differ from each other. The word is supply chain management (SCM).
Despite being different, logistic management and supply chain management are related. As mentioned earlier that logistics includes the process of planning, operating and controlling of quality and effectiveness in moving and storing of goods, services and information from its origin to its destination while considering consumer’s needs. While supply chain refers to a process that helps add more value and helps enrich the process of adding more value for consumer. This process is a cooperation between businesses including suppliers (persons or organisations that supply goods and services to other businesses), customers and business partners.
To clarify, logistics is a part of the supply chain. Aims of logistics management are focused towards managing transportation to achieve highest effectiveness and efficiency resulting in customer satisfactory. On the other side, the supply chain management focuses more on a broader scale of management to gain business advantage ranging from purchasing raw materials from suppliers to shipping end product to consumer.
How is logistics management important to businesses?
- Enhance Efficiency and Effectiveness
Good logistics management helps enhance business’ efficiency and effectiveness in logistics process and supply chain management. - Reduce time spent on processing tasks
Good logistics management leads to reduction in time spent on completing each step of a manufacturing process with the help of information technology and communication system. - Gain competitiveness
Good logistics management creates a chain of communication which helps enhance business’ capability to compete with other businesses and maximise customer satisfaction.
As a business, understanding the differences between logistics management and supply chain management is crucial if you wish to move your business forward or solve current problems. This understanding will help you to come up with a proper solution or strategy to face certain tasks.
