Join Steven Brown for an in-depth discussion in this video Obstacles to coordination, part of Logistics Foundations.
- I read a managerial book a few years ago…titled "The Greatest Management Principle in the World."…What is this greatest principle?…What gets rewarded, gets done.…In short, reward someone for a particular behavior…and they will happily, and quite efficiently,…repeat that behavior over and over again.…This is a pretty good principle for effective management,…but interestingly enough,…I also think this is the number one obstacle…to coordination within your logistics network…and long your supply chain.…
Let me give you an example.…If I link my transportation manager's compensation…to the average transportation cost per unit,…he will be highly motivated to ship everything…in full truckloads to reach that incentive.…This may not be in the best interests…of my company, however.…He will force full truckloads of products…into the warehouses,…and drive up inventory cost…for holding unneeded finished goods.…On the other side of that same coin,…he may hold products at the distribution center or warehouse…until the truck is full,…
These lessons will help you understand the importance of logistics and help your company prepare for efficient delivery, distribution, and inventory. Plus, get insights on the latest logistics trends.
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- Understanding order fulfillment
- Defining logistics
- Comparing inbound, outbound, and reverse logistics
- Key decisions: delivery, distribution, and inventory
- Coordinating the supply chain
- Trends in logistics management