011 465 7668 / 076 422 5456 help@logisticscourses.co.za

As SCM is also interlinked, most organisational strategies have a marked impact on the effectiveness of the supply chain to deliver need-satisfying offerings when and
where they are needed. As SCM encompasses most functional areas (some of which have already been discussed), this section will concentrate on the activities found in
the logistics functional arena. The key issues involved in logistics strategy formulation and implementation are:

demand forecasting
facility selection and design
materials handling
warehouse management
inventory management
order processing
logistics communication
waste disposal
return goods handling (reverse logistics)
investment recovery
parts and service support and
international logistics strategy.

Most activities or departments will have their own respective strategies and tactics within the SCM area. When formulating a logistics strategy, the following aspects need to be addressed:

a management overview, discussing the logistics strategy in general terms, and its relationship with other business functions the financial and physical value of the logistics strategy to the business, and how this will be measured a description of how the logistics objectives are related to the service levels that have been promised to customers a description of service, inventory, warehousing, order processing and transportation capabilities required to support the overall plan a detailed outline of the most important logistics programmes, operations plans, documenting plans, related costs and timing, and their business impact a forecast of the workforce and capital requirements and a logistics financial statement detailing operating costs, revenue, capital requirements and cash flow.

Functional strategies, such as business strategies, are focused on action and momentum in attaining the predetermined objectives of the functional area and the business. Functional strategies represent the formal action plan for the organisation to satisfy the needs of the organisation and the internal and external customers of the value and supply chains.