Growing World of Logistics

Logistics is customer service, relates to developing capabilities and managing activities that focus on meeting support needs, and involves logic and calculations.

Does the term logistics have a precise meaning, or does it simply describe an umbrella concept for a variety of supply-related processes? Do root concepts exist in all contexts in which the term is employed? Is there a general theory of logistics? And what about supply chain management? Is it a new practice, or is it old-fashioned logistics?

In addressing these and related issues, this article examines the origins and applications of the term logistics, presents a new paradigm of logistics in practice, and suggests the appropriate framework of thinking for all logistics practices; that is, a general theory of logistics.

The Term Logistics

The English word logistics appears to have been derived from both the Greek word logistikos and the French word logistique. Logistikos is rooted in the concept of logic and means skilled in calculation. Logistique is probably influenced by the French loger meaning to quarter (or lodge) soldiers. Hence, the combination of logic, calculation, and quartering soldiers appears to have yielded the word.

The term logistics entered military terminology in 18th century Europe. The marechal des logis was the administrative officer responsible for encamping and quartering troops. As warfare became more advanced with an increasing variety of weapons and ammunition, the marechal des logis' duties were expanded to include the stocking of supply depots. [1]

The term was first employed in a formal sense in the American lexicon in the late 19th century when Rear Admiral Alfred T. Mahan, American naval strategist, introduced the word logistics into the US Navy. [2] The term received a written definition in 1905 as that branch of the art of war pertaining to the movement and supply of armies. [3] But it was not until World War II that the term began to be used pervasively to describe the support of military forces and their equipment.

Beginning in the 1960s, logistical support of weapon systems became an integral part of the planning and design stages of these systems. During this period, logistics as practiced in the military grew into engineering (or systems) logistics, with an emphasis on engineering issues, calculating initial support requirements, and programming resources to keep a system operational after introduction. Engineering logistics stresses reliability and maintainability engineering, configuration management, provisioning and continuing supply support, repair level analysis, technical manuals development, training, data and records management, and life-cycle cost management. In this sense of the word, logistics is largely a modeling and quantitative discipline.

The term logistics migrated to the business sector in the 1960s as academicians in marketing saw potential in applying the principles of military logistics to physical distribution of consumer goods. [4] Business logistics evolved into a dichotomy of inbound logistics (materials management or physical supply) to support production, where the plant is the customer, and outbound logistics (physical distribution of product) to support external customers.

Most recently, the business community began viewing logistics as a component of a larger evolving concept, supply chain management (SCM). SCM is a linking of all firms up and down the supply chain (from ultimate material sources to ultimate customers) in a collaborative and seamless network. [5]

Beginning in the 1970s, the term logistics crept into the lexicon of the common culture. The word is now being used with regard to the supply support of activities from church picnics to the Olympics. During the US famine relief efforts in Bangladesh in 1974 and in Somalia in 1992 and 1993, logistics was applied to the distribution of food. [6] In recent years, the popular press has written of the logistics of waging a Presidential campaign and the logistics challenges of providing relief to victims of the floods in Honduras in 1998 and of recent hurricanes.

Definitions of Logistics

Clearly, logistics as a concept and a practice has evolved over the years and is a discipline that is now practiced in different ways and contexts. Logistics means different things to different people. Even professionals in the field differ as to what logistics actually means.

Table 1 presents a variety of definitions of logistics. To some, logistics is managing the flow and stock of materials. To others, it is a customer support activity, a planning and engineering mechanism, or a science of calculating requirements and promoting operational capabilities. The dictionary treats logistics as purely a branch of military science. The Council of Logistics Management defines logistics purely in a product distribution context. The common culture of today views logistics as the underlying details of making something happen.

Perhaps the most fundamental definition of logistics is the classical definition: getting the right product, to the right customer, in the right quantity, in the right condition, at the right place, at the right time, and at the right cost. [7]

All these definitions, explicitly or implicitly, have in common the concept of integrating many activities toward supporting an organizational objective. Further, all have, expressed or implied, a sense of meeting the material, system, or process needs of a customer.

A New Logistics Paradigm

A consideration of the various practices that, taken together, define logistics suggests that logistics is a branch of management that is practiced in four subdisciplines:

* Military or engineering logistics. The design of supportability into weapon systems and other capital assets, assessment of technical requirements for training and maintenance, computation of post-sale support requirements, and integration of all aspects of support for the operational capability of military forces and their equipment.

* Business logistics. The planning and management of supply sources, inventories, transportation, distribution networks, and related activities and supporting information to meet customer requirements.

* Event logistics. The network of activities that brings together the resources required for an event to take place. [9] Event logistics is characterized by deployment of resources (forward logistics) and withdrawal of resources (reverse logistics) according to the events schedule, significant contingency planning, and the powerful presence of the logistics function in the events management team. [10] Examples of event logistics include the detailed planning and support requirements necessary to execute a circus, a rock concert, a scout encampment, news coverage of the O. J. Simpson murder trial (more than 500 reporters and their satellite-linked vans and other equipment), the Olympic Games, and a Presidential trip.

* Process logistics. The acquisition, scheduling, and management of human and material resources to support a service. Process logistics typically involves the coordinated employment of facilities, capital assets, and service personnel to create the framework for a process to occur. Examples include bus transportation of school children, mail delivery, drug smuggling, Red Cross relief operations, and operation of a multidimensional orthodontics office (scheduling stations, personnel, and parallel and sequential workflow for efficient and effective service).

Supply chain management is the collaborative integration of all logistics processes by all players in a chain, from original suppliers through end users. The process is a customer-driven system involving the sharing of information, risks, and assets among partners to achieve an integrated, seamless, responsive distribution system. SCM literature views business logistics as a component of supply chain management. Supply chain management is differentiated from logistics in that it involves all partners (suppliers, carriers, other distribution channel participants, and customers) up and down the supply chain and, hence, is more than the internal integration of logistics activities within a firm. [8] The key concepts of SCM are pull system, customer-driven, strategic alliances, shared data, and system (as opposed to firm) optimization. However, SCM can be viewed as fully integrated logistics, meaning not only the integration of all logistics activities in a firm but also the comprehensive backward and forward in tegration of all logistics processes in a channel. SCM, then, is a new term for integrated business logistics (albeit a larger view of integrated).

A General Theory of Logistics Practices

Interestingly, the dictionary gives only one definition of logistics (the military context of the term). Today, however, the various practices that are considered logistics can be classified into four types. The question arises whether future dictionaries should modernize their perspective of logistics in practice and offer multiple definitions of the term or whether there is some common platform or general theory of logistics from which all logistics practices spring.

A careful analysis of the four branches of logistical practice, as presented, suggests that logistics is customer service, relates to developing capabilities and managing activities that focus on meeting support needs, and involves logic and calculations. The proposition of this research is that there is, indeed, a general theory of logistics practice:

Logistics is the science of developing and managing the capabilities and protocols that are responsive to customer-driven service requirements. [11]

The richness of this construct of logistics is suggested by focusing on the component words and noticing their relevance to all four types of logistics:

* Science: logic, mathematics, statistics, models, computers, information technology, algorithms, engineering principles, systems concept, cost analysis, optimization techniques, tradeoffs, and sensitivity analysis

* Developing: organizing, formulating objectives, designing, team effort, partnering, contracting, creating, evolving, augmenting, achieving

* Managing: planning, negotiating, programming, implementing, communicating, deploying, measuring, controlling, improving

* Capabilities: physical assets, programs, human capital, historical data, forecasting, experience, real-time information, software, hardware, strategic alliances, access, capacity, competence

* Protocols: operational plans, methods, logic networks, data systems, strategies, human decision making, techniques, outsourcing, contingency plans

* Responsive: anticipate needs, meet needs, exceed needs, fulfill objectives, minimize costs, react constructively, respond to change, thwart failure, optimize performance, and differentiate performance

* Customer-driven: pinnacle of direction and control, source of authority, place of ultimate measure, meeting expectations, origin of pull requirements, reason for being, beneficiary of achievement

* Service requirements: meeting objectives, quality, excellence, operational, satisfied, value-added, efficient, responsive, available, damage-free, time-and-place utility, life-cycle management.

Table 2 portrays the general theory of logistics practices as presented in this article for all four logistics subdisciplines. Examples of the capabilities, protocols, and services are illustrated.

Consider, for example, a deployed fighter wing. The customer who drives the requirements and to whom the logistics system must respond is the wing or theater commander. The military logistics organization has in place, as examples, sustainability and airlift capabilities that are executed with specific protocols (logistics plans, supply support, materiel contracts, and industrial mobilization). Some of the services the customer-responsive logistics system provides are fuel, rations, spare parts, and ordnance.

In engineering logistics, a using command (for example, Air Combat Command) specifies readiness and support requirements for new aircraft. The logistics community, with such capabilities as design for supportability and the Integrated Logistics System, uses established protocols (reliability and maintainability engineering, logistics models, repair level analysis, and so forth) to give the customer the product-support services required.

For inbound business logistics, a firm like Proctor and Gamble will specify logistics standards for efficient and responsive support of its production operations. The firm's internal logistics operations will have established capabilities such as a network of world-class suppliers, transportation partners, and a continuous flow capability. These capabilities are realized with the employment of supporting protocols (demand forecasting, materials requirements planning, dedicated contract carriage, and so forth) to provide an inbound logistics system that ensures availability of production materials with minimal investment in inventory.

In outbound logistics, Proctor and Gamble's customer (WalMart, for example) is in the driver's seat, imposing such service standards on Proctor and Gamble's logistics system as ac95percent order fill rate, 5-day order cycle, and damage-free delivery. Proctor and Gamble will have in place customer-responsive capabilities such as regional distribution centers, information and computer technologies, and shipment tracking. These capabilities are built upon protocols such as a point-of-sale replenishment system, vendor-managed inventory, advanced packaging methods, and electronic commerce capabilities that ensure the customer's logistics standards are satisfied.

Similar relationships exist in event logistics and process logistics. Customers dictate standards of service. Logistics systems exercise protocols within their framework of response capabilities.

These illustrations reinforce the notion that there are root concepts or processes in logistics, a general theory of logistics practices that encompasses all logistics.

Summary

The new paradigm introduced in this article demonstrates that logistics is practiced in four subdisciplines: military, business, event, and process.

Logistics is logic, wisdom, calculations, models, networks, inventories, transportation, distribution, customer service, time-and-place utility, storage, flow, details, optimization, and collaborating. It is a set of support activities. It is being responsive to customer requirements for materials, goods, and services.

But the underlying general theory of logistics practices as developed here identifies the roots of logistics as being capabilities, protocols, and responsive service. Indeed, all logistics is the science of developing and managing the capabilities and protocols that are responsive to customer-driven service requirements.

Dr Russell, a retired Air Force lieutenant colonel, is associate professor of logistics management at the Goddard School of Business and Economics, Weber State University, Ogden, Utah.

Notes

(1.) John I. Alger, Definitions and Doctrine of the Military Art, Past and Present, Wayne, New Jersey: Avery Publishing Group, Inc. 1985, 56.

(2.) Silverlo L. Ostrowski, "Generic Strategies for Logistics in the Military and Commercial Sectors," unpublished doctoral dissertation, Cranfield University School of Management, Bedfordshire, England, 1996, 1.

(3.) Chauncey B. Baker, Transportation of Troops and Material, Kansas City, Missouri: Hudson Publishing, 1905, 125.

(4.) John C, Langley, Jr, "The Evolution of the Logistics Concept," Journal of Business Logistics, Sep 86, 1-12.

(5.) J. Blaser and B. Scott Westbrook, "The Supply Chain Revolution," The Performance Advantage, Vol 5, No 1, Jan 95, 43-49.

(6.) "Getting It There," Logistics Handbook for Relief and Development, World Vision International Headquarters, Monrovia, California, 1987.

(7.) R. D. Shapiro and J. L. Heskett, Logistics Strategy: Cases and Concepts, St Paul, Minnesota: West Publishing, 1985, 4.

(8.) Martha C. Cooper, Douglas M. Lambert, and Janus D. Pagh, "Supply Chain Management: More Than a New Name for Logistics," The International Journal of Logistics Management, Vol 8, No 1, 1997, 1-14.

(9.) Event logistics has been defined as "the activities between the event and chaos." See "The Battle of Atlanta: The 1996 Summer Olympics," Distribution Magazine, Mar 96, 24.

(10.) Interview by author with Craig Williams, director of logistics for the Atlanta 1996 Summer Olympics, Mar 98. "No one says no to an event logistician. Conducting the Olympics is logistics."

(11.) Frank W. Davis and Karl Manrodt, "The Evolution to Service Response Logistics," International Journal of Physical Distribution and Logistics Management, Vol 22, No 9, 1992, 3-10.

               Definitions of the Discipline of Logistics
Source         Definition
Short          Management of materials in motion and at
               rest.
Classical      Getting the right product, to the right
               customer, in the right quantity, in the
               right condition, at the right place, at
               the right time, and at the right cost.
               (Called the Seven Rs of Logistics.)
Dictionary     The branch of military science having to
               do with procuring, maintaining, and
               transporting materiel, personnel, and
               facilities.
International  "The art and science of management,
Society of     engineering, and technical activities
Logistics      concerned with require-ments, design,
               and supplying and maintaining resources
               to support objectives, plans, and
               [operations.sup.*]."
Famous         World War II Chief of US Naval
Nebulous       Operations Admiral Ernest H. King: "I
               don't know what the hell this logistics
               is that (Army Chief of Staff General
               George C.) Marshall is always taking
               about, but I want some of [it.sup.**]."
Biblical       "I have heard of you ... that light and
               under-standing and excellent wisdom are
               found in you ... I have heard that you
               give interpretations and solve problems
               ... you shall be clothed with purple and
               have a chain of gold about your neck
               ...." [(Daniel 5:14;16).sup.***]
Utility        Providing time and place utility of
               materials and products in support of
               organization objectives.
Council of     "That part of the supply chain process
Logistics      that plans, implements, and controls the
Management     efficient, effective flow and storge of
               goods, services, and related information
               from point of origin to point of
               consumption in order to meet customers'
               [requirements.sup.****]."
Component      Supply management for the plant (inbound
               logistics) and distribution management
               for the firm's customers (outbound
               logistics) or material support of
               manufacturing and product support of
               marketing operations.
Functional     Materials requirements determination,
               purchasing, transportation, inventory
               management, ware-housing, materials
               handling, industrial packaging, facility
               location analysis, distribution, return
               goods handling, information management,
               customer service, and all other
               activities concerned with supporting the
               internal customer (manufacturing) with
               materials and the external customer
               (retail stores) with product.
Common
Culture        Handling the details of an activity.
                    Example Elements of the General
                     Theory of Logistics Practices
Logistics    Capabilities
Military     Airlift
             Sealift
             Operational readiness
             Sustainability
Engineering  Design for supportability
             Integrated logistics support
             Tradeoffs
             Life-cycle cost management
Business     Continuous flow
(Inbound)    World-class suppliers
             Shipment tracking
             Transportation network
             Inventory management
             Automated materials handling
(Outbound)   Customer-driven
             Computer systems
             Regional distribution centers
             Value-added services
             Shipment tracking
             Carrier management
             Information accuracy
Event        Pre-event planning and staging
             Support
             Cleanup (asset withdrawal)
Process      Bus transportation
Logistics    Protocols
Military     Logistics plans
             Provisioning
             War reserve spare kits
             Containerization
             Supply support
             Maintenance plans
             Materiel and service contracts
             Industrial mobilization
Engineering  Reliability engineering
             Maintainability engineering
             Modeling
             Configuration management
             Repair-level analysis
             Data management
             Life-cycle costing
             Training engineering
             Logistic support analysis
Business     Demand forecasting
(Inbound)    Material requirements planning or
              just-in-time system
             Strategic purchasing
             Global positioning satellite system
             Dedicated contract carriage
             Warehouse management systems
             Automated storage and retrieval systems
             Bar codes
(Outbound)   Point-of-sale technology
              replenishment system
             E-commerce
             Electronic data interchange
             Merchandise labeling/assorting
             WWW site
             Private fleet
             Advanced packaging
             Pick-to-light system
             Vendor-managed inventory
             Collaborative planning, forecasting,
              and replenishment
Event        Logistician authority
             Strategic plan
             Tactical plans
             Procurement system
             Transportation network
             Requirements algorithms
             Command post
             Receiving and storage
             Facilities plans
             Service contracts
             Contingency plans
             Packing and crating
             Reverse Logistics
Process      Asset procurement
              Vehicle maintenance
              Route design
              Time schedules
              Fuel contracts
              Safety plans
                                           Customer
Logistics    Services                      (Example)
Military     Fuel                          Fighter wing
             Rations
             Spare parts
             Maintenance
             Ordnance
             Mail
             Medical supplies
Engineering  Operational readiness         Air Combat Command
             Sustainability
             Product support
Business     In stock                      Manufacturing Plant
(Inbound)    Minimal inventory
             Reliable deliveries
             Warehouse accuracy
             Responsive to requirements
                                           Retail store
(Outbound)   95% order fill rate
             5-day order cycle
             99% picking accuracy
             Damage-free delivery
             Liberal return policy
             96% on-time delivery
             Customer satisfaction
Event        Equipment in place            Olympic venues
             Supplies in place
             Facility operational
             Inventory management & issue
             Asset control and protection
             Flexible response
             Participant support services
             Spectator support services
             Media support services
             Redeployment after event
Process      Transportation to school      School children

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