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IBS320 Managing Global Logistics

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  • Course Code: IBS320
  • University: University of Sunshine Coast
  • Country: Australia

Question:

Logistics Management Report ‘Group’

The concern for low productivity and the need for improving productivity of Australian businesses for making their products competitive in the global markets has appeared in the media and business community from time-to-time over the years. Accordingly, due priority has been accorded in increasing the volume of exports from Australia in various markets in the world. In this endeavour, the businesses in Australia are looking to hire new business graduates like you with a drive and passion for success. Assuming that you are keen in joining such vibrant organisation, you are in the process of developing your individual profile, keeping all your good work, including good quality assignment in various courses, in your personal file. 

The literature on supply chain management and logistics suggests that supply chain management and logistics play an important role in improving organisational performance and enhancing customer satisfaction. Now, you as a student of Global Logistics Management are motivated to prepare a high quality Logistics Management Report to take with you at the job interview to impress the interview panel if you are short-listed. 

In demonstrating your knowledge, skills and ability to apply logistics management concepts in your Logistics Management Report, you are required to review scholarly materials, books and journals and company/industry reports to identify the current issues and future trends in logistics management and make an assessment of the influence of logistics management on organisational performance. 

The table below shows the goal of the assignment along with what you need to cover in your assignment, when you should submit and the criteria that will be used in marking your assignment.

Goal: 

This task is an opportunity to develop and demonstrate your knowledge, skills and ability to apply logistics management concepts by producing a report on Logistics Management

 

Answer:

Introduction

Logistics management is one of the major factors that have affected the country on a larger basis. The logistics is defined as the whole concept of maintaining the flow of the product with the required span of time. The logistics is one of the major parts of the supply chain management which is the primary topic of the concerned report. In accordance to the views stated by Myerson (2012), there are a number of parts of the logistics management system which includes the flow of information in form of demand, the sorting, handling and assortment of materials with the packaging of the products, taking care of the inventory, having a measurable transportation of the goods, warehousing and the employment of the forces of security in the matter. The following logistics management report is to analyse the current issues that is being faced in the Australian industrial sector with the future trends in the same manner. In addition, the influence of the dimensions of the logistics management is analysed in the following paragraphs.

Logistics Management is defined as a part of the supply chain management principle that consists of one of the basic parts of the supply chain theory (Christopher 2016). This part of the supply chain management is used for the purpose of meeting the demands of the customers and also making effective changes in their shopping experience in terms of planning, controlling and implementing. The essence of logistics system is to retain the goods by the company in order to use them for selling to the customers in the concerned span of time. The logistics system is one of the major systems in which the demand for the product can be determined as the company will employ that amount of money in the products that will be sold in the concerned span of time (Mangan, Lalwani and Lalwani 2016). The concept of logistics management is way important in the overall maintenance of the country which makes sure that each of the production and supply process is being done in the concerned manner of time. The concept is wide and follows a various number of models and theories which is being discussed in the following paragraphs.

Due to the isolated location of Australia as an island continent, the problem of logistics has been one of the greatest with the dependency of the continent on the export of the products to the other parts of the global world. Schönsleben (2016), there are a number of issues that are there in the logistics management of Australian arena which are quite unique and challenging for the people. The type of problem in Australia in terms of the logistics issue is given as follows –

The challenges include the demand issues along with the proper lack of transport material and warehousing issues with the required risk management issues which are being discussed in the following paragraphs.

 

Current issues and future trends in Amazon’s logistics

Issues of logistics management

There are a number of logistics issues that are there in the Australian logistics industry which are stated as follows. The issues related to the logistics management in Australia with specific considerations to Amazon Australia are as follows –

Procurement/demand

Procurement is defined as the process or act of obtaining the required goods or services that the organization does for the business purpose. Yu et al. (2016), the procurement in terms of logistics is defined as the action that is done by the means of obtaining in a business purpose for the better supplying of the goods in the future in accordance to the demand of the customers. The procurement of the goods according to the demands of the customers is one of the basic facets of the logistics management which can be used by the company for the sales and the supply in the future (Yu et al. 2016). There are a number of procurement problems in various companies of Australia which means that due to certain problems like accidental bulk orders and inflexible supply system. If the case of Amazon Australia is to be deciphered, the giant company also faced a number of issues like the seasonal demands of things and the unscheduled demand of certain goods that can be a cause of concern for the people engaged with the company. Golicic and Smith (2013), the issues related to the procurement of goods according to the demand made the company, Amazon Australia face multiple logistics issue. The demand of product is variable according to the inflation rate and interest of the customers which also affects the procurement of the company in large amounts.

Mode of transportation

The mode of transportation is one of the most important factors that affect the logistics of a company. Australia has a number of transportation issues in the form of roads, railways as well as the airport and ports which serves to connect the whole of the country to the rest of the world. The mode of transportation is a part and driver of the logistics management system which means that the transportation cost drives the part of the logistics from one side to another. The mode of transport is affected by a number of options mainly the cost of fuel which is one of the greatest parameters making sure that the cost of the transportation system in the logistics department is minimum. For Australia, the port is one of the chief ways which serves the best transport medium for the goods as about 99% of the transportation of goods in logistics is done through ports having a value of 89% of the total trade (Monczka et al. 2015). Amazon Australia faced a number of issues like increase in the cost of fuel and lack of transportation partners for the delivery of the systems including strikes which disrupted the working in terms of stable transportation system which made their position in Australia a big problem. Amazon faced a number of disruptions into their logistics sector in the forms of transport strike and increase in cost of transportation fees which caused a loss of logistics sector. If the transportation of a country is not properly maintained then there is a probable cause that will lead to the disruption of the logistics line within a period. For Australia, their majority of the logistics export is done through ports. If there is an issue in the ports or any transport sector, then there is a huge issue of logistics and its implications to the sector.

 

Warehousing

Fernie and Sparks (2014), Warehousing is defined as a building that is used in commercial manner for the storage of goods for any company. The maintenance of warehouse for the better supply of the goods is one of the prime matters in the case as both warehouse and logistics are part of the supply chain management of a company. The importance of warehouse lies in the fact that it helps the company to store the products and make proper inventory for the required goods. There are a number of issues that the warehouses of a company face including the old stream processes for the inventory management (Wieland and Wallenburg 2012). In addition, fluctuations of demand is also one of the chief problems that warehousing faces in the logistics management of any company. Australia is a country that has opposite seasons from most of the countries which are located in Northern Hemisphere due to its location within the southern hemisphere. With this difference, the products that are stored for winter in Australia are sometimes not needed by the people of the rest of the world which in turn affects the good keeping in the warehousing sector (Grant, Wong and Trautrims 2017). The fluctuation of demand in the warehouse is again one of the mainstream problems of warehousing. Another problem that is there in the warehousing is the increasing amount of labour cost due to the demands of the labour. The warehouse is a place which is to be managed by the labours and their demands need to be analysed which otherwise will lead to issues in the warehouse. Amazon Australia warehouse though quite active in nature fails to accommodate the amount of products that are there in the segment of the company. Amazon’s problem of warehousing also lies in the technological needs that are there in the segment which is one of the principle developments needed in terms of warehousing.

Risk Management

Grant, Wong and Trautrims (2017), Risk Management is defined as the process by which uncertainty of the identification, analysis of the risk is done. There are risks in every aspect of the organization and for logistics, there is a huge amount of risk which needs to be assessed. Logistics has a number of dimensions into it and to measure and make sure that there is a potentiality in every dimension, each of them should have risk management factor. The risk of the logistics is identified, evaluated as well as prioritized to make sure that the risk of the total act is balanced. The Australian logistics arena is one of the most risky arenas as there are a number of baffles in the whole of the logistic management sector which needs to be understood and evaluated (Aguezzoul 2014). For Amazon Australia, their basic task to make sure that all their operations related to the risk management sector is evaluated at the front and then made aware of in the course of time. The risk is evaluated by a team of experts in each of the company to make sure that risk associated with each of the sector is minimised and their bad impacts are not there on the product or business.

Environmental Issues in Amazon 

The procurement of Amazon is one of the basic problems in the overall matter as with the logistics information related to it. The procurement of Amazon is one of the major ways to make sure that environment is having problems of the overall matter in the concentred matter of time. The procurement of Amazon means that the company is gathering products from all over the place and it is being delivered in paper cardboards and plastics which affect the environment majorly.

Warehouse is a place in which the company stores the products and the excessive storage of the items requires matters related to packaging which is again one of the prime elements of Amazon. The warehousing of Amazon affects the environment by using plastics and paper boards in their packaging matters which has devastating effect on the environment.

The mode of transportation in the warehousing and logistics matters is to be analysed to make sure that the pollution level of the matter is analysed. The transportation is causing serious hazards to the environment which is again one of the prime matters in the case.

The mode of transportation is one of the biggest steps that is being made to make sure that the pollution level that is being raised by the company is increasing at a great pace. The mode of transportation is one of the prime environmental issues that is being concerned here which is creating a risk in the environmental matters. The logistics of Amazon should include these changes in the overall matter of the logistics management issue.

 

Future Trends in Logistics Management

In the words of Walker et al. (2014), analysing the growth rate of logistic industry, it has been identified that near about 1.2 million people are involved in this sector. With the increasing economic opportunities, it has been identified that the logistics industry has started contributing in the industry. Analysing the growth trend, it can be said that stronger collaboration in the supply chain process can help to develop the customer relationship management practices. It can be assumed that the business organizations will focus on supply chain risk management practices as it is required for maintaining the substantial interdependence and supply chain security in the business operation.  However, it cannot be denied that with the increasing financial and growth opportunities, various changes have been introduced in the logistics industry in Australia, which can be beneficial for Amazon. It has been identified that individuals’ mobility pattern has been changed and due to changes in supply chain designs, emission and energy costs in the logistic practices have become very important. In the words of Speranza (2018), the future logistic trends can be influenced by the external and internal environment in the Australian industry. Due to the increasing technological opportunities, the accessibility and networking have become flexible for the people (Brandenburg et al. 2014). It can be said that the logistics management has brought the digitalization in the modern business supply chain. It can be assumed that with increasing technological influence in the industry the ecommerce organization like Amazon will be able to improve its quality of service. With the increasing uses of cloud technology and service model software, the entire process will be smoother. The data of supply chain can improve the decision-making and business forecasting of the company. With the increasing chain visibility, in the near future it will bring the efficiency in the inventory management practices. It can be assumed that the linear supply chain can be converted into the circular supply chain with increasing flow of the goods. As its result, the transport as well as the administrative costs can be reduced.

Changes by Amazon in future to save the environment

According to Amazon logistics information, there are a number of issues that are included to change the environment of the matter. The procurement needs to be user friendly and according to the environmental concerns of the whole matter. The changes by Amazon in order to maintain the work of the matter is to be analysed to make sure that the transportation matters in the time are analysed so that there is minimum environmental problems. The warehouse should be made more environment friendly and should make amendments in the required span to make sure that Amazon has maximum advantages to the environmental matters in the concerned time. The transport should run on electric or LPG instead to diesel and petrol so that there is minimum hassles for the environment. The transport should be made pollution free so that there is limited access to the pollution levels.

The future of the logistics of Amazon is to be made according to the laws of the environment and also to make sure that minimise the risk taken in the concerned span of time. The logistics management of Amazon is to be made available for the authorities and for the concerned in the environment. The future trend of Amazon is to be made according to the requirements of the less amount of pollution and which will make the pollution free environment of the lot.

 

Conclusion

At the end of the analysis, it can be commented that in Australia there is a huge logistics problems which has issues relating to procurement, transportation, warehousing and the management of the risk associated with the form of logistics and supply chain. The country’s location and its entry into the business world especially with Amazon has seen a number of drawbacks in terms of the logistics sector which needs to be analysed to make sure that the whole issue is being resolved. The issues of logistics though is a major problem in the business economy of the country can be mended by using some of the recommendations stated in the report. In addition, the issues also have an impact on the different dimensions of the Logistics management which affect the organizational performance in various ways. In conclusion, it can also be commented that logistics is one of the major issues in any business and proper concern should be taken for making sure that the whole arena of logistics is upright in every way which will also better the business and increase the profit level.

Recommendation for the logistics issue in Australia

There are a number of recommendations for the logistics management issue in Australia which are as follows –

  • One of the principle recommendations is to make sure that the seasonal demands and the regular demands of the logistics system are being met. The seasonal demands that is there in the procurement of the issue is being addressed which means that the demands of the public is addressed with immediate effect.The demands of the customer’s needs to be assessed which can be done through poles or even the online customer survey which will make sure that no product is wasted.
  • Better warehousing technique and facilities is to be analysed to make sure that the products that are stored in the proper place with the proper technique of time. The warehousing is the place that stores the things which needs to be done with utmost sincerity.
  • The improvement of transportation and better utilisation of the transport is to be done to make sure that the cost of transportation is less and also the vehicles that are used in transportation technique are also employed in correct manner.
  • The risk factors is to be analysed which means that the less amount of risk is to be taken. In addition, the risk for the logistics system is also analysed which means that less amount of risk is to be managed and more amount of precautions for the measures is to be taken.
  • In terms of Amazon, it needs to make sure that the logistics partner of the company has included all the products as per the demands of the clients and according to the seasonal demands.
  • The warehousing should be made according to the modern technical amenities and should have all the basic features of the warehousing which is again one of the most important parts. The warehousing of Amazon should be well equipped with the necessary products such as necessary technical details as well as required amount of product variety to fulfil the demands of the customers.
  • The transportation of Amazon should be made way better so that each of the mode of transportation is flexible to make sure that the products are delivered on time.
  • The risk of the whole logistics business is to be lessened by investing more in the business.

Other than the given recommendations, the future trends of the logistics management of Australia can be analysed. The following future trends can be segregated into the following parts which are discussed below –

Procurement/demand

In the words of Tatoglu et al. (2016), changing behaviour of the customers has brought various opportunities as well as challenges for the current business industry. It cannot be denied that due to increasing economic growth in the Australian industry, the customers have become very demanding. After the globalization, the technological influence among the customers has brought various options to them. Analysing the current business trend, it can be said that ecommerce has become popular among the customers. It cannot be denied that growth rate of ecommerce has higher level of impact on the logistic industry. Due to the multiple supply chain management practice, it becomes easier for meeting the needs of the customers (Schönsleben 2016). It has been identified that business organizations focus on coping with the various path for purchasing, in case of managing the supply chain between business to business supply chains. . With the Amazon being one of the organizations for the organizational performance and being the best in the matter, the influence on organizational performance mattered. Amazon being one of the major places for the betterment of the organizational performance, it becomes way essential for the company to have a decent amount of performance rate in terms of the logistics management supply.

It has been analysed that demands of the customers are suitable for the business practices as well as the supply chain implication. As an example, in case of buying the products the customer always focus on durability, environmental sustainability and budget. Therefore, it can be aid that depending on the sustainability of the products the demands of the customers’ change, which indirectly influence the logistics management practices. As stated by Nagashima et al. (2015), by highlighting the logistics management practices of Amazon, it can be said that for developing the practices, the company has decided to introduce technological innovation. With the help of technological innovation in the industry, it will be easier to drive the demands of the customers. Involving the technological efficiency in the industry, it will be easier to manage the tracking process of the delivery. Amazon should make sure that the procurement of the company in terms of the logistics supply as well as the products that are there in the customer demands is to be analysed. The procurement of the people in terms of the goods and services of the sector is to be analysed according to the demand of the company and the related facts.

Mode of transportation

It has been identified that the transport odes have become more automated after the changes in logistics management. It cannot be denied that in case of maintaining the effective logistics management practices, the model of transport plays an influential role, but it cannot be denied that after the development, it has become necessary for bringing the infrastructural development in this industry. In case of developing the proper transport infrastructure, the government of Australia has introduced mega city concept. Grabara, Kolcun and Kot (2014), the mode of transportation is important as it helps to enable the trade between people. By supporting this Mangan, Lalwani and Lalwani (2016) stated that infrastructural development in transport is required in case of bringing the civilization development.

In the words of Song and Parola (2015) transportation is being considered as the largest industry in the globe. Time and cost consuming process are being influenced by the transport infrastructure in the country (Richards 2017). Transport facilities have higher level of influence in the logistics management as it controls the raw materials and products movement from one to another destination. In order to achieve the lowest ranges of the cost, transport plays significant role. On the other hand, it can be said that Transportation is important for connecting the role of several steps that focus on conserving the resources into useful products so that the ultimate customers will be benefited. In case of ecommerce organizations like Amazon, model of transportation is very important to deliver the products with in tome to the customers. The transportation model is to be analysed to make sure that the mode of transport used by Amazon for their own use is of less pollution and safe for the environmental matters.

Warehousing

Warehousing is another important key element in the logistics management.  It is important for providing the storage for prepared products, which are being placed for the shipping purpose (Richards 2017). It is true that in case of effective warehousing, it helps to provide the customer as well as the economic benefit to the business organizations. In case of maintaining the value adding operations, goods centralization process and inventory control report management practices, the role of warehousing in the logistics operations is very important.  In case of large organizations such as Amazon, Flip kart and others, where the large numbers of products are being shipped, the entire inventory management proves is being controlled by the logistics managers. On the other hand, it is true that if the products will be stored in the central position, it will be easier for the business organizations to distribute the products (Haimes 2015).

It is also true that in case of adding the value of the goods; the warehousing system has higher level of significance. It helps to place the products in right place at the right time. On the other hand, it is true that depending on the value operation, the cross docking, product mixing, order consolidations are other operations are being done. In the words of Song and Parola (2015), in case of gaining the social benefits, the role of warehousing in the logistics management is very important. It cuts down the transportation and shipping costs. Warehousing of Amazon is to be assessed to make sure that the amount of product in the service is there in the required time and also to the fact that the products that are required in the amazon storage have less effects to the overall matter. The warehousing of the overall frame is to be analysed to make sure that the warehousing is proactive in the storage of the goods as well as the procurement amount.

Risk Management

In the words of Hopkin (2018), by determining the risk management several key elements on logistics process and systems are being determined. In case of internal risk analysis, the process of supply chain management and self-efficiency are being analysed.  In the words of Haimes (2015), the uncertainty may occur in case of logistics management that can influence the entire process in both the positive manner. The risk management practices can be associated with the organizational management, logistics controlling process and organizational planning. It has been identified that the commercial nature of the business can be influenced by both the micro and macro logistics risks. Risks in the logistics practices can bring the changes in infrastructural as well as economic level.

Hence, it can be said that in case of maintaining the flow of the logistics in an uninterrupted way, the risk management initiatives are required for the company Amazon. In case of maintaining the both the quantity and quality of the products the risk management initiative can help Amazon to maintain labour flow. In case of providing the service in foreign countries, the role of the risk management team is very important in case managing the financial and logistics flow (Speranza 2018). On the other hand, the risk management department also play the influential role for maintaining the effective operational transits. Amazon should make certain risk management techniques and measures to make sure that the risk taken by the people on Amazon is worth everything taken for the fact. In addition, the whole of the risk management factor is to be analysed to have the required span of time in the concerned matter. Risk is definitely one of the major issues that needs to be catered by the company and Amazon being one of the prime companies should engage in many risk undertaking measures.

The future trends of logistics management should influence the environment in a more subtle way rather than just being helpful to the organization. Amazon being one of the prime organizations in the field of logistics and procurement, it is of great importance to have the required amount of environmental accessibility in the span of time. The future of the logistics management should include environmental friendly materials in their packaging and other matters. In addition, the transportation matters of the logistics supply is to be mandated and made according to the environment friendly matters to make sure that the whole of the logistics supply of Amazon is working in the full span.

 

References

Aguezzoul, A., 2014. Third-party logistics selection problem: A literature review on criteria and methods. Omega, 49, pp.69-78.

Amazon.com.au 2018. Available online at https://www.amazon.com.au/ (Accessed on 1st October)

Australian Logistics Council. 2018. Australian Logistics Council. [online] Available at: https://www.austlogistics.com.au/ [Accessed 24 Sep. 2018].

Brandenburg, M., Govindan, K., Sarkis, J. and Seuring, S., 2014. Quantitative models for sustainable supply chain management: Developments and directions. European Journal of Operational Research, 233(2), pp.299-312.

Christopher, M., 2016. Logistics & supply chain management. Pearson UK.

Esfahbodi, A., Zhang, Y. and Watson, G., 2016. Sustainable supply chain management in emerging economies: Trade-offs between environmental and cost performance. International Journal of Production Economics, 181, pp.350-366.

Fernie, J. and Sparks, L., 2014. Logistics and retail management: emerging issues and new challenges in the retail supply chain. Kogan page publishers.

Golicic, S.L. and Smith, C.D., 2013. A meta?analysis of environmentally sustainable supply chain management practices and firm performance. Journal of supply chain management, 49(2), pp.78-95.

Grabara, J., Kolcun, M. and Kot, S., 2014. The role of information systems in transport logistics. International Journal of Education and Research, 2(2), pp.1-8.

Grant, D.B., Wong, C.Y. and Trautrims, A., 2017. Sustainable logistics and supply chain management: principles and practices for sustainable operations and management. Kogan Page Publishers.

Haimes, Y.Y., 2015. Risk modeling, assessment, and management. John Wiley & Sons.

Hopkin, P., 2018. Fundamentals of risk management: understanding, evaluating and implementing effective risk management. Kogan Page Publishers.

Mangan, J., Lalwani, C. and Lalwani, C.L., 2016. Global logistics and supply chain management. John Wiley & Sons.

Mangan, J., Lalwani, C., and Lalwani, C. L. 2016. Global logistics and supply chain management. John Wiley & Sons.

Monczka, R.M., Handfield, R.B., Giunipero, L.C. and Patterson, J.L., 2015. Purchasing and supply chain management. Cengage Learning.

Myerson, P., 2012. Lean supply chain and logistics management. New York: McGraw-Hill.

Nagashima, M., Wehrle, F.T., Kerbache, L. and Lassagne, M., 2015. Impacts of adaptive collaboration on demand forecasting accuracy of different product categories throughout the product life cycle. Supply chain management: an international journal, 20(4), pp.415-433.

Pradabwong, J., Braziotis, C., Tannock, J.D. and Pawar, K.S., 2017. Business process management and supply chain collaboration: effects on performance and competitiveness. Supply Chain Management: An International Journal, 22(2), pp.107-121.

Richards, G., 2017. Warehouse management: a complete guide to improving efficiency and minimizing costs in the modern warehouse. Kogan Page Publishers.

Schönsleben, P., 2016. Integral logistics management: operations and supply chain management within and across companies. CRC Press.

Schönsleben, P., 2016. Integral logistics management: operations and supply chain management within and across companies. CRC Press.

Song, D.W. and Parola, F., 2015. Strategising port logistics management and operations for value creation in global supply chains.

Speranza, M.G., 2018. Trends in transportation and logistics. European Journal of Operational Research, 264(3), pp.830-836.

Tatoglu, E., Bayraktar, E., Golgeci, I., Koh, S.L., Demirbag, M. and Zaim, S., 2016. How do supply chain management and information systems practices influence operational performance? Evidence from emerging country SMEs. International Journal of Logistics Research and Applications, 19(3), pp.181-199.

Tatoglu, E., Bayraktar, E., Golgeci, I., Koh, S.L., Demirbag, M. and Zaim, S., 2016. How do supply chain management and information systems practices influence operational performance? Evidence from emerging country SMEs. International Journal of Logistics Research and Applications, 19(3), pp.181-199.

Walker, P.H., Seuring, P.S., Sarkis, P.J. and Klassen, P.R., 2014. Sustainable operations management: recent trends and future directions. International Journal of Operations & Production Management, 34(5).

Wieland, A. and Marcus Wallenburg, C., 2012. Dealing with supply chain risks: Linking risk management practices and strategies to performance. International Journal of Physical Distribution & Logistics Management, 42(10), pp.887-905.

Yu, Y., Wang, X., Zhong, R.Y. and Huang, G.Q., 2016. E-commerce logistics in supply chain management: Practice perspective. Procedia Cirp, 52, pp.179-185.

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