Logistics strategy deals with the flow of products into and out of the manufacturing process.
Logistics strategy deals with the flow of products
into and out of the manufacturing process. Three trends are evident:
centralization, outsourcing, and the use of the Internet. To gain logistical
synergies a cross business unit, corporations began centralizing logistics in
the head-quarters group. This centralized logistics group usually contains
specialists with expertise in different transportation modes such as rail or
trucking. They work to aggregate shipping volumes across the entire corporation
to gain better contracts with shippers. Companies like Amoco Chemical, Georgia –
Pacific, Marriott, and Union Carbide view the logistics function as an
important way to differentiate themselves from the competition, to add value,
and to reduce costs.
May companies have found that outsourcing of
logistics reduces costs and improves delivery time. Many companies are using
the Internet to simplify their logistical system. For example, Ace Hardware created
an online system for its retailers and suppliers.
Tags : Strategic Management - Functional Strategy
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