Check out what logistics is and why it’s important for the efficiency of your project!

The term logistics is present in almost all of our daily operations, albeit in a simple way. It is used for basic things like planning the best way to work or route to avoid traffic, for example.

It also has a very important application in the corporate world. Logistics allows the control of the production flow, from the receipt of materials to delivery to the customers. All through its storage and transport functions.

In this article, you will see how logistics are used to improve the efficiency of processes. It also increases the productivity and benefits of companies. For this, we have separated the text into the following topics:

• What is logistics and how does it work?
• What are the types of logistics?
• What are the logistics tools?
• What is Lean Logistics and what are its principles?
• Manage your projects efficiently! 

When we talk about projects, we think about something of great magnitude. This is a mistake, because a project may be involved with small day-to-day activities. We can cite some examples in solving internal problems, negotiating with suppliers, delivering products, implementing systems and strategies. The correct management of the projects brings benefits to the organization, being able to be used in problem-solving. Good project management defines precisely the decision-making processes and also identify causes and effects.

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What is logistics and how does it work?

Logistics refers to a management area whose purpose is to store, circulate and distribute products. Basically, the product must be delivered in a short period of time and without losing its original quality.

Therefore, it is necessary to have knowledge of routes and set up projects so that delivery costs are viable. In addition, thinking about the best way to get around is also feasible.

Logistics is essential in the management framework of companies, whether bigl or small. It uses strategic demand planning and monitored execution to perform procedures efficiently.

How does it work?

Logistics processes include two main functions in companies. Are they:

Storage

It consists of material handling of physical space. It can mean the access of parts and tools to workers. As well as a specific space for the storage of products.

Often, it is related to the performance of a warehouse/stock. Receiving and delivery of items and products is the main responsibility, covering activities such as cargo conference and material organization.

Transport

The entire process of transporting goods. In the beginning, for the acquisition and receipt of the item by the warehouse/stock.

Through the movement between the stages of the process. Until the delivery of the final product, fleet management, fulfillment center and delivery to the customer.

Logistics KPIs

To check if your company's logistics service are efficient, you can analyze some KPIs (Key Performance Indicators), such as:

• Delivery Time: comprises the time it takes from the customer's order to delivery. It is a percentage calculated by dividing the orders delivered on time by the total orders.
• Order Accuracy: It is the number of orders that are delivered without incidents. Some examples are wrong shipping, missing items or damaged products. The higher this rate, the more money saved and the better customer satisfaction.
• Inventory Turnover: The number of times the entire inventory was sold in a period of time. It is an indicator of planning, production and process efficiency. It can show whether the company has difficulty generating revenue from the products sold.

What are the types of logistics?

The main types of logistics are:

1. Supply

Logistics and Supply Chain Management are directly correlated. It gained prominence with the trend of just-in-time production, seeking to reduce inventory costs. It involves issues related to the supply of raw materials, such as:

• How much material is needed?
• When will the material be needed?
• Which supplier is able to supply more adequately?
• What means of transport did you use?
• Where will the material be stored?

Based on the answers to these questions, it is possible to develop a more adequate and efficient operational strategy. Responsible for avoiding shortages or waste.

2. Production

It refers to the coordination of the production flow within the company, having inventory management as a fundamental element.

Spatial distribution, movement of resources and workflow are some of the aspects designed to facilitate it.

3. Distribution

Distribution corresponds to the product delivery process, the move goods from stock to the store or customer. It involves handling issues (loading, unloading and transporting cargo), inventory monitoring and incoming and outgoing records.

4. Reverse Logistics

This type of logistics is a responsibility of companies for the waste generated by products after consumption or end of life.

It is when strategies for the correct disposal of electronic waste come in.

What are the logistics tools?

In general, there are several systems that help logistics management. Some of them are:

ERP (Enterprise Resource Planning)

Enterprise Resource Planning assists in the integration of databases, inventory control, order fulfillment and other aspects of logistics management.

CRM (Customer Relationship Management)

Customer Relationship Management is super important for logistics to be able to interface your product with the end consumer.

Data and information about a negotiation can build customer loyalty, meet customer requirements as well as provide customer service.

MRP (Material Requirement Planning)

Material Requirement Planning is the process of managing and planning the amount of materials required on the production line. This happens to satisfy a specific demand for the production of a product.

MRP facilitates the management with suppliers for the acquisition of raw materials. It allows that there is no shortage or excess in stock.

TMS (Transportation Management System)

For transport, there are Transportation Management Systems, which are systems for fleet control and delivery routes.

WMS (Warehouse Management System)

Warehouse Management System has the function to facilitate stock management, offering, as a consequence, the optimization of spaces used in warehouses.

What is Lean Logistics and what are its principles?

Lean Logistics aims to increase the performance of the entire company. Through the pragmatic application of lean tools to combat waste in its logistics operations.

It is focused on reducing costs in operations. For that, it is necessary to have a very well done Value Stream Map. Through this map, it is possible to identify which activities really add value to the process.

In addition, its fundamental concepts are:

1. Invest in batch size reduction;

2. Increase delivery frequency;

3. Achieve flexible and efficient production leveling.

Just In Time

Just in Time (JIT) is a concept that is based on a pull production system. It does not only involve the supply, production, logistics or maintenance sectors, for example.

It seeks to cover all organizational areas and its entire supply chain. When managed efficiently and objectively, provide any company with a much more productive and effective sequential flow of operation.

Two of the many tools that seek to meet its concept are SMED and Poka-Yoke.

Kanban

The Kanban technique consists of managing the flow of material movement along the entire supply and production chain.

With it, the systematic and consistent reduction of the batch of products from suppliers and customers proves to be opportune.

Also, the frequency becomes higher and production becomes more flexible. Leveling features lower setup rates and higher productivity.

Manage your projects efficiently! 

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