A few years ago I saw a student studying in the Cuddy center at UAA. I asked the student about his major, and the student proudly declared, “I am a business major.” I suggested the student take a logistics course. The student then replied, “I know how to pack a box.” I could not think of any greater disservice this college could do than to graduate a business major who did not understand the role of logistics in business today.
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Dr. Philip uses the story of Cinderella to explain the role of logistics in today’s business. The step-mother is the CEO, and the step-sisters are finance and marketing. Poor Cinderella does all the work and gets none of the credit.
But in the end, Cinderella gets the prince. Logistics originates from the study of war. How do you ensure you get the right stuff, to the right place, at the right time, without any waste? In my opinion, that is business in today’s world. If the customer wants green beans Tuesday at 2 p.m., you do not want green beans there on Monday.
If the customer wants an I-Phone 7 tomorrow, you do not stock the shelves with I-Phone sevens yesterday. In my opinion, in today’s world, business is logistics. If you work as a cashier at Safeway, you work in logistics. If you sell vacuum cleaners door-to-door, you work in logistics. If you grow barley for the local brew-pub, you are in logistics. One problem with “my opinion” is that everyone already “thinks” they know what logistics does.
Most companies have a “logistics department” that is in charge of distribution, purchasing, transportation, or warehousing. So to help my clients and students communicate I delineate transportation, logistics, and Supply Chain Management as follows. Transportation is moving something from “Point A” to “Point B.”
Logistics is solving the problems that arise when making or moving something. And Supply Chain Management is logistics plus finance and marketing.
Your company supplies full grown trees to a real estate developer. Your trees come from your “huge tracks of land.” Your customer comes to you and wants to pay your more money for your trees. What do you reply?
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