Logistics Management Software is a Component of SCM/CRM Systems
Logistics management software helps automate tasks involved in logistics, which is part of the larger systems of Supply Chain Management (SCM) and Customer Relationship Management (CRM). We will look first at the components and significance of logistics before looking at logistics management software.
What Are Logistics and Logistics Management?
Logistics was originally a branch of military science, dealing with the issues of procurement, maintenance and transportation of military supplies to the forward positions of military. Men, arms, ammunition and rations need to be moved and accommodated without disruption for successful military campaigns.
Even though logistics management is still a key military strategy, these days, logistics is more concerned with business. Goods and services need to be moved from their points of origin to the points where they are consumed. This involves integration of transportation, inventory, warehousing, material handling and packaging into a coordinated endeavor. Information is the key to such coordination.
Transportation can be through sea, air, land or rail. Modern containers, and vehicles and material handling equipment tailor made for these containers, make inter-modal transport (transferring goods from warehouses to trucks to rail to ships or planes, and in the reverse direction at destination) speedy and efficient.
Inventory and warehousing keeps track of the receipts, storage locations and issues of goods. Material handling equipment like automated cranes, conveyors and robots, along with barcode and RFIDs, can handle these tasks with a minimum of human intervention.
Packaging is also a logistics task. For example, if you explore different alternatives of putting cartons of different sizes into a standard sized container, you will find that one of these alternatives can accommodate many more cartons than other alternatives. More significantly, by standardizing carton sizes, you can avoid wasted space in the container.
There is also the issue of selecting the best route for transporting, and of mixing shipments to different destinations, to save on costs.
As would be evident from the above discussion, logistics management is a complex exercise and software can significantly enhance the effectiveness of this process and reduce its costs.
Logistics Management Software
Logistics management software typically has the following physical configuration in large warehouses and distribution centers:
- The software itself resides in a central computer receiving information from and giving instructions to field equipment and operators
- Information is captured by terminals, and handheld or other devices, in the field through reading barcodes or sensing RFIDs
- Barcodes or RFIDs are attached to containers and other packages, so that each item can be identified and tracked
- On receipt of information about the arrival of a container, the central computer determines where to store it, and controls its movement to the storage location through conveyors, automated cranes and sorting systems
- When customer orders are received, the system quickly identifies the location of relevant merchandise and controls its retrieval and movement to pickup area
- The system determines which container or package is to go to which transport vehicle, and controls its movement to the selected trailer
- Finally, the system might keep track of each shipment till it is delivered to the customer
The logistics management software thus transforms the warehousing processes dramatically, and also typically interfaces with the larger Supply Chain and Customer Relationship Management systems.
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