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Who is the Director of Logistics
I compare the director of logistics with a traffic light at the intersection. Its role is to synchronize business processes, link the wishes of the commercial unit, creativity and other areas of the company into a single scheme that defines the rules of movement.
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The logistics director formalizes and synchronizes processes for the end result. Therefore, the area of his responsibility is unlimited.
It is important that he is not “in the house”, thinks broadly and takes part in the optimization of all business processes of the company, and not only works in “his” zone.
When I first started my career in logistics and worked at Procter & Gamble, I heard an important thought. The vice president of procurement at P&G Europe once told us:
The main approval of the work of logistics from management is when you are not noticed. So, with this function, everything is fine at the moment.
What is the role of logistics in business
Logistics forms chains to connect the company with suppliers and customers.
At each stage, added value must arise: material or informational. Logisticians optimize the chain and exclude stages that do not carry added value.
Inside his company, the logistician works with finance and marketing. Outside the company – with warehouses, transport operators, suppliers and manufacturers.
What to consider when working with international logistics
#1. Learn the experience of others. You are not the first to engage in logistics. Therefore, it is important to analyze the experience of others. Look broadly at market solutions and adapt to the best of them. There are more examples in international logistics than in local ones.
You can see and adapt the solution that was implemented in China, Indonesia, Europe.
Logistics Director at the Moscow Central Department Store – about the main threats in logistics. 0
# 2 Check carefully. The farther the source of goods from the market, the greater the uncertainty in the supply chain. Therefore, work out in detail each element of logistics. This is the only way to understand the situation comprehensively and influence it.
# 3 Experiment. Always ask yourself why, and not otherwise, whether it can be done differently.
#4. Optimize: at home and out. Try to improve processes not only on your side, but also on the side of key partners.
What are the differences in logistics in different areas
In the logistics of food products – a focus on compliance with requirements and standards, strict control over expiration dates.
In the field of clothing retail, seasonality plays a role.
For example, the turnover in Adidas is 60 million units per year, and 70–75% falls on December-January and June-July. Collections are replaced: the new import should go in, and the old collection should return to the warehouse. At the same time, the collection is being replaced at discount stores.
During this period, the highest load: an eightfold increase in relation to the average annual load. Therefore, flexible outsourcing schemes and increased throughput are needed.
In network cosmetic companies, the main difficulty is with the points of sale.
For example, Faberlic has 300+ distribution points in Russia, Kazakhstan, and Ukraine. Goods are distributed through them, and delivery must be controlled in accordance with the catalog. Then arrange the return of what was not implemented.
How to control the effectiveness of logistics
Logistics performance depends on the company profile. Some metrics are examined daily, some – every week, month, quarter. But it’s important not just to track, but to understand how the team affects the situation and adapts business processes.
A key performance indicator for logistics is one that explains its actions through the company’s business focus. If it’s sales, the main indicator is the availability of goods.
If production – providing raw materials and components for it. If the service is the quality of the service.
I would like to talk about a wreck with products, but this is not the worst.
The main threat in logistics is the inability to assess business priorities.
When I worked at Coca-Cola, the company acquired the Aquavision plant. So the company has an ambitious commercial unit.
But in order to realize his tasks, he had to conflict with other units.
The tasks of Аquavision were more important for the company and it was necessary to support them. Unfortunately, due to focusing on their departments or not understanding the big picture, not everyone did.
It is important to follow not the personal preferences, but the interests of the business. To support what the business was created for and why you get paid.
Unpredictability. There may be significant deviations of the actual load from the planned or from the average load over the period. The reasons are different, but the consequences are always the same: disruption of supplies or increase in the price of operations.