Several organisations are expanding beyond their national borders as a strategy to improve competitiveness and their ability to offer diverse products to an expanded market. Many companies have become very proficient at supplying products throughout the world. The task requires not only the ability to recognize opportunities, but also an information system to co-ordinate the supply of goods
and materials to places where they are needed throughout the world.
Logistics is supply, distribution and replacement of materials, goods and personnel. It is a problem for all organisations, both public and private. For instance, there were tremendous logistics challenges of moving the US military army, navy, and air force to carry out the military operations called Desert Storm, problems which were even more complex when other nations belonging to the United Nations assisted with the operations. Large logistical problems are faced by relief agencies which are trying to give public assistance to people during emergencies.
In a small warehouse, improvements can be obtained from better information systems, productivity improvements, inventory () savings, reductions in returns (, , ), space saving (10-30 per cent), and extra customer service profit. That is, for a warehouse of 80,000 sq. ft, 50 staff, and $100 million sales per annum, and inventory of $40 million, it is possible to save over $2 million per annum from improved methods. The costs of such improvements can be retrieved after just three months.
The logistics aspects of the distribution chain () in any organisation relate to the use of information to manage more effectively the functions of transportation, storage, warehousing, and freight forwarding ( ). The information system has to co-ordinate a distribution network which consists of transportation services between suppliers to factories, factories to storage facilities, ports and warehouses, storage services in the warehouses, transportation services between the warehouses and buyers and linkages between countries. As a result of implementing an efficient information system and computer network, McDonald's restaurants are able to receive food products from various suppliers, repackage them to meet McDonald's specifications, and then deliver them to their restaurants throughout the world, and still maintain consistent () standards.
Some companies perform logistics services themselves, but many are contracting these services to specialists who have information systems to offer a package of services from simple storage and warehousing to a total package or complete service which might include consolidation () of cargo, transportation, storage and inventory management. Companies within the logistics sector distinguish themselves by the totality of the services they offer. Generally, smaller firms may have less sophisticated
information systems and may only provide services such as warehousing and transportation. Large firms have the resources and economies of larger scale to develop more sophisticated information and computer systems. However, developing a sophisticated and centralized information and mechanized warehouse may not necessary lead to a success.
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Certain larger companies choose to rely on more flexible systems, which allow for learning and adaptation.
. .
Complex
Total
Diverse
Keep up
Profit
Very great, enormous
Help
Totality
A. tremendous
b. of different kind
sophisticated
D. assistance
E. maintain
F. returns
g. entirety
h. complete
C. , :
