Today we had the opportunity to hear from a professor at a university in Barcelona. The university was old and had gorgeous stone architecture. Seeing that university really made me want to get my masters at an old school in Europe! Professor Albert provided us with a two hour “master class” covering the topic of logistics management.  Logistics is defined as the process of planning and organizing to make sure that resources are in the places they need to be.  The objective of logistics management is to plan and coordinate the activities necessary to achieve a desired level of delivery service and quality at the lowest possible cost. The scope of logistics ranges from procurement and management of raw materials to the delivery of the final product to the customer. The professor emphasized lowest cost multiple times as the purpose of logistics is to satisfy the customer by establishing linkages of people at all levels in the organization either directly or indirectly to the marketplace.

It is getting more and more difficult to maintain a competitive advantage over other companies. The distinctive factor is the level of customer service offered and that of its competitors.

There are seven R’s of logistics:

• Right time
• Right Place
• Right Price
• Right product
• Right quantity
• Right customer
• Right condition

With online shopping booming consumers expect everything to arrive on time. We viewed a future of logistics video. The video showed the shipment of a package from procurement through to final destination. The flow of the product went through each leg of the transportation process from trucking to sea or air to the deconsolidation and sorting warehouse from the cargo plane. There are uncontrollable events that affect these organized processes that logistics deals with every day. The future of logistics lies in logistics 4.0. We learned about logistics 4.0 at our visit with Estoko, the move to a more digitized world of logistics. The future of automated logistics is the combination of human labor, AI, robots and technology that increases efficiency.

There are pros and cons to each type of transport. For example, air transport is very fast but the worst carbon emissions and low capacity for transport. Road transport is less investment and more flexible. Ocean freight is most important globally compared the the EU road transportation is most important. Within the ocean freight category there are sub categories. 43% of ship freight is a bulk carrier. Bulk carriers carry raw materials primarily. Oil tankers make up 29% of ocean cargo. Container ships consist of chemical containers, LNG ships (liquid natural gas), RORO ships which carry cars, general cargo and livestock ships.

A hot issue with global logistics and ocean freight is gigantism. Ships are getting larger and larger in hopes of transporting more at once. The issue with this is the capacity of the ports is too small. Another issue is the size of rivers and canals that these container ships have to go through. Previously there was a problem where a boat was too large and got stuck in the Suez Canal. I am from near Savannah, Georgia which is an important international port. The port in Savannah has been approved to go through with deepening and widening the river to allow for larger ships to come in. Other challenges for the supply chain include rising freight prices, raw material shortages, congestion at ports, inflation, digital transportation, demand forecasting and supply chain ESG. ESG is so important as we look towards the future. 

This visit was educational and rewarding, I definitely learned a lot about logistics management that I was not aware of before!