Logistics concept: concept, basic provisions, goals, objectives, stages of development and application

2024 Author: Howard Calhoun | [email protected]. Last modified: 2023-12-17 10:16

In the article we will talk about the concept of logistics. We will consider this concept in detail, and also try to understand the intricacies of logistics processes. In the modern world, this area occupies a rather significant place, but few people have a sufficient idea about it.

Concept

Note that logistics is defined as the ability to calculate correctly. From an economic point of view, it is an activity in the field of practice and science, which is associated with the organization of the movement of various flows from one point to another. This implies the ability to properly manage, organize and optimize. It is very important that the goal of logistics is to get the product to the end consumer.

At the beginning of the last century, a scientific work called "Transport Logistics" was published, which made it possible to organize the correct transportation of military forces, which gave some advantage in the course of hostilities. When the Second World War began, logistics was already actively used, and its methods were widely used for the purpose of supplying the army.

It is very difficult to talk about logistics without understanding the key points. Let's look at some key terms. The first is the supply chain. It represents the various constituent elements of the transportation process that influence each other. They are ordered according to certain criteria, namely, material, informational and monetary.

Another important concept is the logistics network. It represents a large number of people and technical elements that are involved in ensuring the most efficient transportation.

It is also worth considering the concept of a logistics channel. It is a set of specific system changes that allow you to completely organize one full-fledged transportation process.

Tasks

Production logistics concepts boil down to some basic tasks, which we will cover below. So, they include:

• Formation of a clear system for regulating various flows.
• The ability to correctly predict the potential volumes of goods for transportation, production, storage.
• Determining the gap between required and possible indicators.
• Determination of demand for certain goods, which is considered in the context of logistics.
• Providing full service.

These are the common tasks facing this direction.

Narrow objectives and purpose

Let's consider the narrower tasks thatin front of you the concept of integrated logistics:

• Reduction of transit times.
• Reducing product storage times.
• Compiling the required minimum of goods.

The key goal of logistics can be formulated like this: a specific product of a specific quality in a specific quantity must be delivered to a specific place at a specific time in such a way that the cost of this is minimal.

Development

The active period of development of logistics began in the 70s of the last century. Until then, this area of life was not given enough attention, although there were some works and developments. The peak of production just fell on the named period. That is why entrepreneurs began to actively look for various ways to improve the efficiency of their production and possible competitive advantages. Businessmen quickly realized that sometimes smart financial investments increase the chances of success much more than a thoughtless investment.

Many people were interested in the idea of logistics because it allowed them to fully track the movement of products or raw materials, as well as analyze possible costs and losses, and optimize transportation in all sorts of ways. At the same time, the correct application of the principles made it possible to reduce the cost of goods, which turned out to be the main key factor.

That is why it became clear that logistics is very profitable from an economic point of view. After a while, it began to be used in almost all areas of business, and the active progress of science andtechnology. Thanks to the advent of computer technology and mobility, it has become quite easy to control all stages of transportation, monitor cash flows, managing them at any stage.

Key features

The evolution of the concept of logistics has led to the fact that two main functions stand out. These are coordinating and operational functions. The latter is connected with the fact that the management of material values in the field of production is ensured. If we consider the topic of our article through the prism of production, then logistics is a tool that allows you to control the movement of products at all stages of production.

Coordination

As for the coordination function, it includes analysis, identification of problems, search for material needs, forecasting the development of the situation in one direction or another, data processing. In other words, the essence of the function is to capture changes in supply and demand and act on it. Operational planning, in turn, allows you to create the right order and schedule of movements, thereby significantly reducing costs.

Basic Functions

The concept of the concept of logistics allows us to highlight several fundamental functions. Consider them in order:

• The system-forming function lies in the fact that logistics allows you to use effective tools and direct them to a reasonable use of resources.
• The integration function is that logistics simultaneously decidesprocess issues such as marketing, transportation, delivery, mediation, etc.
• The regulatory function is that it is possible to fully control and manage all flows.
• The resulting function allows you to determine the needs and needs, limit the time and place, maintain the desired quality and cost level. Note that the effectiveness of logistical research depends precisely on how the resulting function is implemented.

Basic concepts of logistics

Scientists distinguish several periods of development of this sphere, which depended on the level of development of production. Allocate a period of absence of logistics principles, a period of traditional logistics and a period of new principles. Each of them can be described using a certain concept that justifies certain provisions, evaluation criteria, basic management principles.

Note that initially the transportation of goods and the logistics of production were considered separately from the production itself. That is, it was only an option that allowed for a more correct organization of activities. Suppose there was a company that was engaged in the production and transportation of products. So, people from the lowest management levels were responsible for logistics. This tells us that not enough attention was paid to this issue and few understood its real role.

However, the impetus for development was the widespread use of cars, which attractedattention to some logistical principles. After some time, the correct organization of goods transportation has become one of the key areas of the company's work. The efficiency criterion was the price for moving the goods.

Initially, the specialists who de alt with these issues developed only tariff rates and built a route, but then the list of their competence expanded significantly. They were already responsible for managing cargo flows, choosing one or another type of transport service.

Traditional period

From this point on, deeper concepts of logistics management begin to develop and the traditional period of development begins. Over time, more and more requests appear, namely, it is necessary to control transportation, check all invoices, study packaging, measure weight. But all this makes the work very versatile and narrowly focused. A logistics specialist already needs to know much more and be able to analyze information in order to choose the most rational path. But everything served the fact that this area began to develop very actively not as an additional application in production, but as a separate and important industry. She received rapid development because she was always interested in entrepreneurs, but there was not enough knowledge to use all her advantages.

New ideas

The information concept of logistics begins to develop afterall the basic principles and bases have already been stated. The innovation lies in the fact that the efficiency of goods distribution becomes the criterion for the effectiveness of any economic activity. Also, the new period is characterized by the fact that specialists begin to use combined methods in order to evaluate the effectiveness of the movement of various commodity values. At the same time, it was quickly discovered that the management of traffic flows and the coordination of all actions did not yet provide sufficient efficiency. It is very difficult to consider the sequence, as well as tie together different aspects of the activity.

Neologistics

This period began in the early 1980s, and it is characterized by the fact that logistics began to be introduced into various enterprises as an integral element of the production process. Despite the fact that it did not yet have the proper resources for management, as well as the opportunities for this, it nevertheless allowed achieving certain results. Even working autonomously, it made it possible to quickly respond to changes in transportation. The quality of work largely depended on the experience of the specialist and whether he uses the methods of efficient transportation in the complex.

Modern logistics

We have considered the basic concepts of logistics, but we must understand that in its current form this area is very progressive. Modern specialists are guided by integrated approaches and programs that allow you to combine different methods of work, taking into account the necessary material and economic aspects,and link the work to the needs of production and marketing. There is a combination of all possible points of view and methods into a single whole. In other words, logistics no longer focuses on being autonomous. It begins to integrate to obtain better performance. An integrated logistics system is being created that allows organizing transportation as efficiently as possible. During this period, there is also an adjustment of economic interests with the needs of individual production.

Summing up the results of the article, we note that the development of the concept of logistics was rather unstable and superficial. Before due attention was paid to this issue, production efficiency was rather low. When the peak of the development of logistics systems came, a much larger number of entrepreneurs became interested in issues in this area. This made it possible to introduce logistics to most enterprises and industries, which brought it to a completely different level of development.

We reviewed the basic concepts of production logistics that existed before and developed harmoniously. At the moment, logistics is a complex branch of knowledge that exists in conjunction with others. The concept of logistics requires an understanding of how much production depends on well-executed operations that reduce overall costs.