The Bullwhip Effect

An unmanaged supply chain is not inherently stable. Demand variability increases as one moves up the supply chain away from the retail customer, and small changes in consumer demand can result in large variations in orders placed upstream. Eventually, the network can oscillate in very large swings as each organization in the supply chain seeks to solve the problem from its own perspective. This phenomenon is known as the bullwhip effect and has been observed across most industries, resulting in increased cost and poorer service.

Causes of the Bullwhip Effect Sources of variability can be demand variability, quality problems, strikes, plant fires, etc. Variability coupled with time delays in the transmission of information up the supply chain and time delays in manufacturing and shipping goods down the supply chain create the bullwhip effect. The following all can contribute to the bullwhip effect:

Overreaction to backlogs Neglecting to order in an attempt to reduce inventory No communication up and down the supply chain No coordination up and down the supply chain Delay times for information and material flow Order batching - larger orders result in more variance. Order batching occurs in an effort to reduce ordering costs, to take advantage of transportation economics such as full truck load economies, and to benefit from sales incentives. Promotions often result in forward buying to benefit more from the lower prices. Shortage gaming: customers order more than they need during a period of short supply, hoping that the partial shipments they receive will be sufficient. Demand forecast inaccuracies: everybody in the chain adds a certain percentage to the demand estimates. The result is no visibility of true customer demand. Free return policies

Countermeasures to the Bullwhip Effect While the bullwhip effect is a common problem, many leading companies have been able to apply countermeasures to overcome it. Here are some of these solutions:

Countermeasures to order batching - High order cost is countered with Electronic Data Interchange (EDI) and computer aided ordering (CAO). Full truck load economics are countered with third-party logistics and assorted truckloads. Random or correlated ordering is countered with regular delivery appointments. More frequent ordering results in smaller orders and smaller variance. However, when an entity orders more often, it will not see a reduction in its own demand variance - the reduction is seen by the upstream entities. Also, when an entity orders more frequently, its required safety stock may increase or decrease; see the standard loss function in the Inventory Management section. Countermeasures to shortage gaming - Proportional rationing schemes are countered by allocating units based on past sales. Ignorance of supply chain conditions can be addressed by sharing capacity and supply information. Unrestricted ordering capability can be addressed by reducing the order size flexibility and implementing capacity reservations. For example, one can reserve a fixed quantity for a given year and specify the quantity of each order shortly before it is needed, as long as the sum of the order quantities equals to the reserved quantity. Countermeasures to fluctuating prices - High-low pricing can be replaced with every day low prices (EDLP). Special purchase contracts can be implemented in order to specify ordering at regular intervals to better synchronize delivery and purchase. Countermeasures to demand forecast inaccuracies - Lack of demand visibility can be addressed by providing access to point of sale (POS) data. Single control of replenishment or Vendor Managed Inventory (VMI) can overcome exaggerated demand forecasts. Long lead times should be reduced where economically advantageous. Free return policies are not addressed easily. Often, such policies simply must be prohibited or limited.

This flow chart shows a typical manufacturing supply chain work flow detailing which areas of the business are involved. 2. The sales department identifies a need for a product. The sales department tell the marketing department about their idea and provide any supporting information / data. 3. The marketing department use business analysts to support the project and to complete the research. 4. Data and supporting evidence is passed back to the marketing department for completion of a business plan. 5. A fully detailed business plan is forwarded to the Business Unit Manager / Directors.

6. This unit comprises of the senior business directors or managers who make a decision on the project. 7. After approval the plan is passed back to the analysts to prepare and implement the manufacturing process. 8. Details of raw materials and components passed to purchasing. 9. Purchasing work with logistics and transport to plan the purchase and delivery of the materials to the manufacturing plant. 10.Suppliers receive orders for product and then despatch on agreed transport on agreed dates. 11. Carriers approved by the business transport the raw materials and components to the manufacturing site. 12. Products are received into the warehouse and then moved to manufacturing. 13. Finished products are moved from manufacturing to the finished goods warehouse which might be situated locally or ina remote location. 14. Finished goods are put into inventory awaiting orders. The company computer system is updated. Product is now available to sales. 15. Customers place orders through customer services. 16. Customer Services take orders and input them to the company computer system. 17. The central computer system maintains transaction records and provided visibility of product for sale. 18. An order is completed and a pick list sent to the warehouse. 19. A copy of the order is sent to the export department for completion of export documentation. 20. Export department manages the final despatch of the product and produces any export documents. 21. Documents are sent to the warehouse to meet up with the finished order. 22. The order is despatched by the warehouse.

23. The transport company collects the consignment and delivers it to the customer based upon the INCO terms of carriage. 24. As stock has now been used the computer system generates a request for new stock. 25. The re-order process generates a request to the purchasing department to place new orders with the suppliers.

Information technology
The following is a list of the key service areas covered by DBC Consulting:

Change Management Its true, all organisations change, large and small. Whether you relish the challenge or are a reluctant participant you may profit from the experience of those who have managed the process before. We can offer guidance and advice on how to set and control the pace and extent of change so that its right for you. If appropriate, we can manage the process for you using methods and practices that leave you in control.

Feasibility Studies You need to get good ideas off the ground quickly if they are to give you that competitive advantage you seek, but which ideas are the good ones? The days are gone when feasibility studies can take their own time, you need to get to the pilot stage, fast!

Hardware / Software Evaluation How do you compare one against another and arrive at a selection that is right for you? Well, as always, its simply a matter of understanding what your needs are and picking the best functional fit, isnt it? Well no actually, but unless youve done it before, and sometimes even if you have, a good salesperson can make their product sound like it was designed just for you. It wasnt.

IS Procurement Support We understand the IT economics to be applied in the process of negotiating for software products and services. We can carry out market searches for new product/service initiatives, including competitor and or competitive product research and IT solution evaluation. We can audit vendor methods and procedures to ensure they are delivering competitively priced, industry-leading products and services. And much more.

IS Strategy Review Todays technology will quickly be surpassed but your approach to the deployment of technology. With a proper understanding of the place of IS in your business you can plan ahead and gain benefits today.

Programme and Project Management Whether it is a single or several related projects, a fundamental key to success is exceptional management. DBC Consulting offer project and programme management services based on skills and a lot of experience. We can help you with your project whatever its current status.

Systems Interface and EDI Connectivity Why are the largest operators so intent upon electronic commerce? Well, put simply, the benefits are too great to ignore. But these benefits are available to everyone. With our knowledge and understanding of appropriate kinds of interfaces between the systems of supply chain participants, we can ensure you concentrate effort where the benefit is greatest.

Web Solutions The web can be a daunting proposition for small and medium size companies who have no experience of the www's capabilities. DBC Consulting provides a forum to discuss the web's capabilities and how these can be utilised in a beneficial way to you and your company.

Supply chain Management

Key elements to a supply chain

Production Supply Inventory

Location Transportation Information

Detail of key elements

Production Element of Supply Chain *Focus on what customer & market demand *Resource Management *Internal sourcing (what and which plants) *Outsourcing to capable suppliers *Capacity Management *Workload schedules *Equipment plans (acquisition/maintenance) *Order Management *Quality control

Supply Element of Supply Chain *Partners in the Supply Chain *Assessing core/strategic competencies *Identifying capable suppliers *Making sourcing decisions *Relationship management *General Procurement

Inventory Element of Supply Chain *How Much Inventory and Where to Store It

*Analysis of fluctuations in demand *Identification demand of optimal storage locations in support of *Customer

*Identification of optimal stock levels by location *Establishing inventory ordering policies

Location Element of Supply Chain *Strategic placement stocking facilities *Understand customer markets *Perform locating decisions for production and stocking facilities *Lightweight/market driven near the end-user *Heavy industries near raw material source *Evaluation of tax and tariff issues and transportation accessibility Transportation Element of Supply Chain *Supporting decisions and customer Demand requirements (transportation is up to 30% of *Product Cost!) *Identify service levels *Identify forms Air Ship Rail Ground customer inventory of production plants, distribution and

modal

*Establish transportation partnerships

strategic

Key Attributes of a Chain *Cannot the capacity of its weakest link *A break chain makes the chain non-functional *All move in synchronization *All an interdependency links in exceed

the

must

links

have

Supply Chain Driving Factors *Information Revolution *Intra-Enterprise Technology *The Internet *E-Commerce *Inter-Enterprise Technology *Dynamic Systems *Relational stores *Desktop Tools *COTS (ERP, S&OP, CPFR) *Customer Demand Revolution Operating

data

Information Element of Supply Chain *Obtaining, and leveraging information across the Supply Chain linking

*Organization of information *Linking through networks and the internet *Streamlining information flow *Consolidating information *Information warehousing *Decision tools support computers

Adaptive forms of Relationship Management

*Relationship Assessments *Alliance mechanisms *Assessing variables of Reliability, Competence, *Affect Based Trust (Goodwill), Vulnerability *Risk and Loyalty *Conflict Resolution *Aversion disputes *Arbitration a business decision *Mini-trial *Rent-a-judge *Information a Common Thread as to legal evaluation

key

sharing

as

Challenges in Supply Chain Management Today

*Strategic imperative of supply chain

*Deliberate of supply chain networks *Offshore (lead-times/customer service impact) *Supply design to customer requirements *Cash-to-cash cycle *Supply visibility technology *Strategies inventory positioning near customers *Warehouse challenges *Collaboration with supply chain partners
Tags: ERP SOFTWARE, Supply chain Management Sorry, comments for this entry are closed at this time.

redesign

outsourcing

chain

chain

for

Management

Role of Information Technology in Supply Chain Management

By

Rohita Kumar Mishra

Department of Business Administration Sambalpur University
Rohita Kumar Mishra did his M.B.A. from Sambalpur University in the year 2004 and presently pursuing research work after qualifying UGC NET/JRF Examination in 'Management'

ABSTRACT

This paper focuses the role of Information technology (IT) in supply chain management. It also highligh the contribution of IT in helping to restructure the entire distribution set up to achieve higher service levels and lower inventory and lower supply chain costs. The broad strategic directions which need to be supported by the IT strategy are increasing of frequency of receipts/dispatch, holding materials further the supply chain and crashing the various lead times. Critical IT contributions and implementations are discussed. Fundamental changes have occurred in today's economy. These changes alter the relationshi we have with our customers, our suppliers, our business partners and our colleagues. It also describes how IT developments have presented companies with unprecedented opportunities to gain competitive advantage. So IT investment is the pre-requisite thing for each firm in order to sustain in the market.

INTRODUCTION:

Supply chain management (SCM) is concerned with the flow of products and information between suppl chain members' organizations. Recent development in technologies enables the organization to avail information easily in their premises. These technologies are helpful to coordinates the activities to mana the supply chain. The cost of information is decreased due to the increasing rate of technologies. In the integrated supply chain model (Fig.1) bi-directional arrow reflect the accommodation of reverse materia and information feedback flows. Manager needs to understand that information technology is more than just computers. Except computer data recognition equipment, communication technologies, factory automation and other hardware and services are included.

Integrated supply chain model Bi-directional arrow reflects the accommodation of reverse materials and information feedback flows.

Managers need to understand that information technology is more than just computers. Except compute data recognition equipment, communication technologies, factory automation and other hardware and services are included. The importance of information in an integrated supply chain management environment:

Prior to 1980s the information flow between functional areas with in an organization and between supply chain member organizations were paper based. The paper based transaction and communication is slow During this period, information was often over looked as a critical competitive resource because its value to supply chain members was not clearly understood. IT infrastructure capabilities provides a competitiv positioning of business initiatives like cycle time reduction, implementation, implementing redesigned cross-functional processes. Several well know firms involved in supply chain relationship through information technology. Three factors have strongly impacted this change in the importance of information. First, satisfying in fact pleasing customer has become something of a corporate obsession. Serving the customer in the best, most efficient and effective manner has become critical. Second

information is a crucial factor in the managers' abilities to reduce inventory and human resource requirement to a competitive level. Information flows plays a crucial role in strategic planning. Supply chain organizational dynamics:

All enterprises participating in supply chain management initiatives accept a specific role to perform. Th also share the joint belief that they and all other supply chain participants will be better off because of t collaborative effort. Power with in the supply chain is a central issue. There has been a general shift of power from manufacturers to retailers over the last two decade. Retailers sit in a very important position in term of information access for the supply chain. Retailers have risen to the position of prominence through technologies. The Wal-Mart & P&G experiences demonstrate how information sharing can be utilized for mutual advantage. Through sound information technologies Wal-Mart shares point of sale information from its many retail outlet directly with P&G and other major suppliers. The development of Inter organizational information system for the supply chain has three distinct advantages like cost reduction, productivity, improvement and product/market strategies. Barrett and Konsynsik have identified five basic levels of participation of individual firms with in the interorganizational system.

1. Remote Input/Output mode: In this case the member participates from a remote location with in t application system supported by one or more higher-level participants. 2. Application processing node: In this case a member develops and shares a single application such an inventory query or order processing system. 3. Multi participant exchange node : In this case the member develops and shares a network interlinking itself and any number of lower level participants with whom it has an established business relationship. 4. Network control node: In this case the member develops and shares a network with diverse application that may be used by many different types of lower level participants. 5. Integrating network node: In this case the member literally becomes a data communications/data processing utility that integrates any number of lower level participants and applications in real times. Four fundamental mistakes made when determining information requirements are as follows: 1. 2. 3. 4. Viewing system as functional instead of cross-functional. Interviewing managers individually instead of jointly. Not allowing for trial and error in detail design process. Asking the wrong question during the interview

Information and Technology: Application of SCM:

In the development and maintenance of Supply chain's information systems both software and hardware must be addressed. Hardware includes computer's input/output devices and storage media. Software includes the entire system and application programme used for processing transactions management control, decision-making and strategic planning. Recent development in Supply chain management

software is: 1. Base Rate, Carrier select & match pay (version 2.0) developed by Distribution Sciences Inc. which is useful for computing freight costs, compares transportation mode rates, analyze cost and service effectiveness of carrier.

2. A new software programme developed by Ross systems Inc. called Supply Chain planning which is us for demand forecasting, replenishment & manufacturing tools for accurate planning and scheduling of activities. 3. P&G distributing company and Saber decision Technologies resulted in a software system called Transportation Network optimization for streamlining the bidding and award process. 4. Logitility planning solution was recently introduced to provide a programme capable managing the entire supply chain. Electronic Commerce: It is the term used to describe the wide range of tools and techniques utilized to conduct business in a paperless environment. Electronic commerce therefore includes electronic data interchange, e-mail, electronic fund transfers, electronic publishing, image processing, electronic bulletin boards, shared databases and magnetic/optical data capture. Companies are able to automate the process of moving documents electronically between suppliers and customers. Electronic Data Interchange:

Electronic Data Interchange (EDI) refers to computer-to-computer exchange of business documents in a standard format. EDI describe both the capability and practice of communicating information between tw organizations electronically instead of traditional form of mail, courier, & fax. The benefits of EDI are: 1. 2. 3. 4. 5. 6. 7. 8. Quick process to information. Better customer service. Reduced paper work. Increased productivity. Improved tracing and expediting. Cost efficiency. Competitive advantage. Improved billing.

Though the use of EDI supply chain partners can overcome the distortions and exaggeration in supply a demand information by improving technologies to facilitate real time sharing of actual demand and supp information. Bar coding and Scanner:

Bar code scanners are most visible in the check out counter of super market. This code specifies name product and its manufacturer. Other applications are tracking the moving items such as components in P assembly operations, automobiles in assembly plants.

Data warehouse: Data warehouse is a consolidated database maintained separately from an organization's production system database. Many organizations have multiple databases. A data warehouse is organized around informational subjects rather than specific business processes. Data held in data warehouses are time dependent, historical data may also be aggregated. Enterprise Resource planning (ERP) tools:

Many companies now view ERP system (eg. Baan, SAP, People soft, etc.) as the core of their IT infrastructure. ERP system have become enterprise wide transaction processing tools which capture the data and reduce the manual activities and task associated with processing financial, inventory and customer order information. ERP system achieve a high level of integration by utilizing a single data model, developing a common understanding of what the shared data represents and establishing a set o rules for accessing data. Conclusion:

World is shrinking day by day with advancement of technology. Customers' expectations are also increasing and companies are prone to more and more uncertain environment. Companies will find that their conventional supply chain integration will have to be expanded beyond their peripheries. The strategic and technological innovations in supply chain will impact on how organizations buy and sell in t future. However clear vision, strong planning and technical insight into the Internet's capabilities would necessary to ensure that companies maximize the Internet's potential for better supply chain management and ultimately improved competitiveness. Internet technology, World Wide Web, electroni commerce etc. will change the way a company is required to do business. These companies must realize that they must harness the power of technology to collaborate with their business partners. That means using a new breed of SCM application, the Internet and other networking links to observe past performance and historical trends to determine how much product should be made as well as the best a cost effective method for warehousing it or shipping it to retailer.

THE ROLE OF TECHNOLOGY IN SUPPLY CHAIN Priyank Azad

in Technology / Information Technology (submitted 2008-12-21)

by

THE ROLE OF TECHNOLOGY IN SUPPLY CHAIN A supply chain consist of all those parties who are directly or indirectly involved from the point of procurement to the point of sale. This means that all the activities from the extraction of raw material to the final sale to the customer forms a part of supply chain. Today the manufacturing enterprises must pool resources with a large number of suppliers to produce their products. Since years, the companies have realized that an effective supply chain is necessary for minimizing the costs and maximizing the profits. For building up a proficient supply chain network, an effectual Information technology system is very important. Information is one of the most crucial ingredients of supply chain management. Without information, the managers will not know the demand of the customers, the stock of inventory available with him and when to order, how much to order and when it should be shipped. This is where the role of IT comes into the picture. For example, IT system of a Laptop manufacturer can provide relevant information regarding the number of units available with the store, the demand of the customer and his feedback on the various products. Through all these facts the manufacturer

can analyze the demand and order the inventory at the right time so as to fulfill the demand of the customers. Another example which can trace the importance of information in supply chain is Wal-Mart. Wal-Mart is very well known for its supply chain. According to Pete Abell, Retail Research Director, AMR Research, Boston ? Wal-Mart is the best supply chain operator of all times. Efficiency is a key factor in maintaining Wal-Mart's low-price leadership among retailers. Their margins can be far lower than other retailers' because they have such an efficient supply chain. The company's cost of goods is 5% to 10% less than that of most of its competitors." Wal-Mart captures the information on sale of its products from all its stores, analyses the demand and then determines that how much inventory it should hold in each store and how much should be ordered. It sends the same information to all its key suppliers so as to ensure that the orders are fulfilled in time and the lead time is reduced. The use of ERP software is serving the companies in improving the integrity of the data. This real time improvement in data helps in making optimum decisions at the right time. Through Electronic data interchange, the employees can improve relationships amongst them as well as with the vendors and suppliers. RFID or Radio frequency identification is another technology which is creating a sensation in the world of technology. RFID is a system of electronic tags that transmit data through a radio signal to RFID readers and related hardware and software infrastructure.The adoption of RFID will revolutionize supply chains in a new era of efficiency and business intelligence. RFID will assist in reducing the cost and chucking inefficiency out of the supply chain by keeping a better track on each item manufactured, shipped and sold and thus enhancing the transparency in the supply chain system. In a nutshell, technology has been the life and blood in all the fields since many years but in supply chain, it is playing a miraculous role. Not only by cutting the cost, enhancing efficiency and optimizing the entire supply chain network, Technology is also playing its role in satisfying the customer demand and thereby maximizing the revenues for the company

MRP - A Planning System?

The MRP (Material Requirements Planning) concept exists since the 60s of the last century. It is the basis for most software systems supporting production planning and control in industrial practice. Most of these so-called MRP systems provide good assistance for order processing, data handling and inventory book-keeping, but they do not support planning. A typical MRP system follows a successive planning concept, as depicted in the following figure.

Master Production Scheduling.

Based on existing customer orders and a medium-term aggregate production plan Master Production Scheduling (MPS) prepares a short-term production plan for end or rather main products. The planning result is the Master Production Schedule, which is commonly referred to as the MPS.

Material Requirements Planning.

The next step, Material Requirements Planning (MRP), uses the MPS as a starting point and computes derived demands for all components required for the production of the end products. The planning data used are the bill-of-materials structure (BOM structure, Gozinto structure), the current inventory status (including planned receipts) and planned lead times. Within this planning step lot sizes are computed under the assumption that infinite capacity is available. Result of these computations are planned production quantities per item and period.

See also: Material Requirements Planning computations

Capacity Requirements Planning.

Next, for each operation required to make the products the planned starting time and ending timeare computed with the help of standard project planning algorithms, such as the Critical Path Method (CPM). Again, capacities of the resources are neglected (infinite loading). Following

this planning step, the capacity requirements resulting from infinite loading are tabulated and graphed. Usually the comparison with the available capacities shows that the production plan developped so far is infeasible. This is the point in time when adjustment of the production plan by the human planner comes into play. Usually based on experience, the planner tries to shift operations on the time axis in order to generate a feasible production schedule. If this is not possible due to conflicts between the resource requirements of different operations, the capacity is extended by overtime, if possible. In general, a human does not have the capability to solve this complicated combinatorial optimization problem, which is a variant of the so-called Resource-Constrained Project Planning Problem (RCPSP).

Production Control.
In the last planning, for the upcoming short-term planning horizon production oders are released and assigned to the resources. For each resource orders are scheduled with the help of simple priority rules.

Critique of the MRP concept

Basically, the MRP concept is nothing else than the automation of order processing procedures that in earlier days have been done manually. Planning methods that support decision making in the sense that a feasible production plan is developped are not applied. The MRP concept has been criticized by many scientists as well as practitioners in a large number of publications. Its flaws are system-immanent and cannot be deleted by modern data base methods, user interfaces and faster computers. The major flaws to be criticized are: 1. The medium-term aggregated production planning which aims at the coordination of sales and operations planning is not supported. Usually the production plan is equated to the sales plan. With scarce resources, however, these both plans must differ. 2. The production lot sizes are computed for each item in isolation without consideration of the interdependencies between predecessor and successor items in a multi-level BOM structure. The competition of items for resources is neglected, which leads to infeasible production plans. In addition, the cost-related interdependencies between a parent item and its components are not considered. Whitin the MRP planning phase a successive planning of the items is performed (first requirements computation, then lot sizing), based on an ordering of the items according to their low level codes. 3. In the MRP phase and in the Capacity Requirements Planning phase so-called "planned lead times" are used. These are stored as a resource-independent characteristic of an item in the production data base and are often not changed for years. The planned lead time includes estimates of transportation times and of waiting time due to scarcety of production resources. However, it is obvious that the waiting time for a resource depends on the workload of the resource. As the workload and, consequently, the bottleneck status of a resource changes over time, it does not make sense to store the waiting time (as part of the planned lead time) in a

data base. The lead times are a result of the planning and not a given. 4. All planning phase suffer from the severe flaw, that the scarce capacities of the resources are completely neglected in the planning. Only immediately before the start of the production operation on the job shop level the infeasibility of a production schedule is recognized. But at this point in time, it is too late. Delivery delays and superfluous inventory are the consequence.

What Is a Logistics Strategy? When a company creates a logistics strategy it is defining the service levels at which its logistics organization is at its most cost effective. Because supply chains are constantly changing and evolving, a company may develop a number of logistics strategies for specific product lines, specific countries or specific customers. Why Implement a Logistics Strategy? The supply chain constantly changes and that will affect any logistics organization. To adapt to the flexibility of the supply chain, companies should develop and implement a formal logistics strategy. This will allow a company to identify the impact of imminent changes and make organizational or functional changes to ensure service levels are not reduced. What Is Involved in Developing a Logistic Strategy? A company can start to develop a logistics strategy by looking at four distinct levels of their logistics organization.

Strategic: By examining the companys objectives and strategic supply chain decisions, the logistics strategy should review how the logistics organization contributes to those high-level objectives. Structural: The logistics strategy should examine the structural issues of the logistics organization, such as the optimum number of warehouses and distribution centers or what products should be produced at a specific manufacturing plant. Functional: Any strategy should review how each separate function in the logistics organization is to achieve functional excellence. Implementation: The key to developing a successful logistics strategy is how it is to be implemented across the organization. The plan for implementation will include development or configuration of an information system, introduction of new policies and procedures and the development of a change management plan. Components to Examine when Developing a Logistics Strategy When examining the four levels of logistics organization, all components of the operation should be examined to ascertain whether any potential cost benefits can be achieved. There are different component areas for each company but the list should at least include the following:

Transportation: Does the current transportation strategies help service levels? Outsourcing: What outsourcing is used in the logistics function? Would a partnership with a third party logistics company improve service levels? Logistics Systems: Do the current logistics systems provide the level of data that is required to successfully implement a logistics strategy or are new systems required? Competitors: Review what the competitors offer. Can changes to the companys customer service improve service levels? Information: Is the information that drives the logistics organization real-time and accurate? If the data is inaccurate then the decisions that are made will be in error. Strategy Review: Are the objectives of the logistics organization in line with company objectives and strategies.