Logistic Component of a Plan Presentation

!±8± Logistic Component of a Plan Presentation

Finally it's necessary to focus attention on the logistic component of a plan. The successful execution of a plan always depends on the ability to supply a variety of goods and manpower regularly and on time: fuel, ammunition, spare parts and qualified men. Likewise, when a company introduces a new product, it must have ensured beforehand that it can deliver on time and to specification. When the company fails to do so, not only can the reputation of a company be severely damaged but prospective customers will turn to substitute products or brands and, consequently, these prospective customers will be lost forever. Just as with every part of a plan, the logistics component must have an inherent flexibility in it to be able to cope with the reality of the battlefield (the market), positive or negative.

Case I:

Insurance Company and marketing success

An insurance company did not believe in the possible success of a marketing campaign for the introduction of a new, innovative car insurance policy. When the campaign was launched, it was overwhelmed by the unexpectedly high number of applications for the new policy. Although warned beforehand by its marketing manager, it had abstained from taking adequate organizational preparations to be able to scale the processing of new applications. Many aspiring policy holders had to wait such a long time that they were forced to go to other insurance companies, just to get their car insured in time.

Case II:

Senseo Crema

Logistics problems also beset Philips in 2001 when they introduced their unique "Senseo Crema" coffee machine, as a consequence of its great success. In the beginning buyers had to wait 2 to 3 months before they received their coffee machine. Luckily at that moment there were no competitors offering the same kind of machines.

In the art of war good logistics has always played a decisive role. That is why actions to disrupt the supply lines of the opponents were often a strategic goal in itself. The importance of logistics has to be given due attention in every aspect of planning and decision-making, in the 'grand strategy', in the local strategy, as well as in the tactics.

Case III:

Anti shipping war

The submarine warfare conducted by the German Navy in the Second World War was a war ofattrition aimed at the sea routes from the USA to Britain. The supply of Britain, both to keep the bridgehead as well as to prepare for the invasion, was a logistic grand-strategy that was eventually won by the Allies by the introduction of the convoy-system, the development of technical innovations like sonar, radar and by the introduction of the "baby-flattop"65 that would protect the convoys by providing continuous air support.

Case IV:

Afrika Korps (1941/42)

After his victory at Gazala and after the conquest of Tobruk, when the German Marshal Erwin Rommel in June 1942 resumed his march to invade Egypt and reach Alexandria and the Nile, his supply lines became so long (around 900 km) that he suffered great fuel and ammunition shortages. Without this vital fuel, his technically superior tanks became immobile. Moreover, the British successfully disrupted his supply lines over sea from Italy. Finally Rommel, the 'Desert fox', was forced to halt his invasion within sight of his ultimate goal.

In the military context logistics influence the functioning of a military organization in several ways:
It influences the "fighting power"; It influences the resilience of the forces; It influences the flexibility. Similar effects can be seen in the industrial enterprise.
To satisfy the logistical demands, armies have stimulated innovation from which we still
profit today.

To name a few:

Napoleon introduced tinned food; The American Army popularized instant coffee; The Germans invented the "Jerry can" (strong and leak free fuel containers); The American Army, to realize its fantastic amphibian operations in the Pacific, developed a series of innovations like the roll-on-and-off-ship, refuelling on the high sea etc.; Several kinds of mathematical models were developed during World War II to predict required supplies, calculate the loading of ships, etc. (e.g. sequential analysis,queuing algorithms). In short, the science of war has provided modern management with all kinds of logistic tools that help to manage the supply and delivery requirements of a company more efficiently.

Case V:

The container

The logistic invention with probably the greatest impact on present day logistics is the 'Container' -invented after the war (1956). Malcolm Mc Lean (USA) can reasonably claim to be the man who conceived the idea of container shipping to replace the traditional break bulk method of handling dry goods. Containers produced a huge reduction in port handling costs, contributing significantly to lower freight charges and, in turn, boosting trade flows. Almost every manufactured product humans consume spends some time in a container. The container is now of course also intensively employed by the military.