Global Logistics and Supply Chain Management
Global logistics and supply chain management is the entire production flow from start to finish. This includes:
- Operations management
- Manufacturing processes
Many supply chain networks operate on a global scale. This is essential for public and private sectors that have global customer bases or require specific raw materials.
Global logistics and supply management will face all the operational issues of a regional business. It will also manage the differences in processes and agreements in different countries.
This article will examine the landscape of global logistics and supply chain management. It will also explore global supply chain strategy design, as well as the importance of strong working relationships.
Understanding the Global Logistics and Supply Chain Landscape
Organizations must understand global trade patterns and flow to provide an efficient service. This concerns the flow and direction of imports and exports between different countries.
This will be determined by natural resources and manufacturing infrastructures.
Trade agreements and other regional differences will play a key factor in how efficiently an organization can work in or with a country.
Supply chain management and global logistics will require a number of key players to run smoothly. This will include:
- Intermodal Marketing Company
- Terminal / Port Depots
- Freight Forwarder
- Transportation Provider
- Logistics Service Provider
- Beneficial Cargo Owner
- Distribution Center
AI and automated systems have benefitted global logistics and supply chain management significantly. This is because it provides real-time analytics and tracking.
International logistics requires accurate inventory management. State-of-the-art inventory management systems provide much-needed clarity.
Designing a Global Supply Chain Strategy
The goal of global supply chain management is to provide customer satisfaction.
Efficient services minimize waste and reduce costs. This can result in higher profitability and more competitive product prices.
An efficient service will also provide accurate delivery estimates and high-quality products.
Global supply chain management must also align with corporate strategy and values. Open lines of communication with stakeholders and clear visibility help to provide this.
Global supply chain managers will create and optimize the supply chain network. This will include implementing sourcing and procurement strategies that are cost-effective and reliable.
Risk management and the resilience of supply chains are essential, as potential disruptions from a global perspective can have damaging consequences. Risk management strategies will explore all the issues that can affect international trade. This can include political instability and natural disasters.
The recent global pandemic has also ensured contingencies and risk management strategies think on a global scale.
Setting KPIs for different stages of the supply chain makes it easier to measure performance. This will help to identify areas that could impact the efficiency of the supply chain.
Supplier performance must also be monitored to ensure it is up to the standard required for an efficient supply chain. Measuring performance is also important for stakeholders that want clear visibility of operations.
Managing Global Logistics Operations
Global logistics is dependent on real-time supply chain data flows. This allows tracking and management of transportation.
Global logistics makes use of a number of transportation modes. These include:
- Ocean Shipping
Intermodal transportation of materials helps to improve efficiency. This is when one storage unit can be moved by road, rail, or ship without having to unpack and change the storage.
Freight forwarding and customs brokerage are important to global logistics and supply chains. These are the services that help to move goods through ports and customs. They will provide services that include:
- Customs clearance
- Trade documentation
Warehousing and inventory management are important to global supply chains. This ensures all the products are kept safe and accounted for.
Barcode or radio frequency identification (RFID) systems simplify this process. Barcodes would have to be scanned and would automatically update inventory management systems.
RFID allows systems to read signals emitted by tags. This provides real-time tracking and inventory levels to supply chain management systems.
Different carriers might be used in different countries for order fulfillment and distribution. Third-party logistics (3PL) companies are used to provide this service.
Managing 3PL performance levels can help with future negotiations. It will also identify failures to reach delivery targets.
Reverse logistics is when excess or unwanted products are returned back along the supply chain. They typically won’t be as widescale an operation as the original supply chain. It must still perform to a high level to meet standards and be cost-efficient.
In some cases, it is possible for logistics management to arrange the drop-off and collection at the same time. This helps to minimize costs and the environmental impact of transportation.
Building Strong Partnerships in Global Logistics
Building strong supplier relationships is essential to communication and negotiations.
It is also essential that time goes into selecting the correct supplier to mitigate risk. The same goes for selecting logistics providers and carriers. Once selected, monitoring performance will help to determine how effective they are in the position.
Technology can be used to improve visibility and communication with internal and external stakeholders and minimize supply chain vulnerability. This is because supply chain technology will facilitate the free flow of data and improve collaboration.
Setting targets for each level and aspect of the supply chain is important. It provides valuable data that is essential for continuous improvement.
Global logistics and supply chain management is a high-paced business. Emerging technologies are being developed continuously, and keeping with them provides the best opportunity for success.
Global logistics and supply chain management is essential to many businesses around the world.
It requires a good understanding of different markets and regulations. It also makes use of a number of key players, so selecting the best people to collaborate with your company is essential.
The use of state-of-the-art technology can improve communication and tracking. It can also be used to monitor performance.
It is essential that organizations implement risk management strategies to mitigate risk. International trade can be significantly more complicated than national operations. There is more scope for disruption so contingencies must be in place.
Learn more about supply chain risk management in our other supply chain management posts.
What is global logistics and supply chain management?
Global logistics and supply chain management is the process of procurement, manufacturing, and distribution on a global scale.
Supply chains are essential to many international businesses. Good global supply chain management will implement risk management strategies. It will also make use of the latest technology and software to improve the flow of data and communication.
What are the key challenges in global logistics and supply chain management?
Global supply chain management must factor in all the challenges national or regional supply chains face. They must also consider the differences in policies and regulations in different countries.
It is essential that supply chains maintain ethical and sustainable practices when dealing with other nations.
How do I design a global supply chain strategy?
To develop a global supply chain strategy you must:
- Be customer focused
- Align the strategy with business objectives
- Compare competitors
- Ensure the strategy is robust and ‘futureproof’
- Employ risk management strategies when assembling a team