SOME IMPORTANT LOGISTICAL CONCEPTS

LASH (Lighter Aboard Ship)

The lighter aboard ship or LASH---barge-carrier or barge-carrying vessel---is
designed to carry lighters (barges), where they are lifted by crane over the stern (rear)
of the vessel.
The LASH and barge come in different configurations. Some LASHes can
accommodate over 24 barges. Each barge may carry 600 to 1,000 metric tons of cargo,
which is much bigger than the ocean freight container, and can float and be towed up
and down a river or canal, thus the barge is often referred to as the floating container.
The LASH is useful in moving a relatively large volume of cargo in the short-
sea trade and to and from sites on rivers and canals, such as Rhine Canal in Europe,
that cannot be used by the larger ocean-going vessels. The LASH keeps the load in the
same vessel for the entire trip, thus reduces cargo handling, transport costs and time.
The LASH is popular in Europe, taking advantage of the extensive inland
waterway systems which are the cheapest means of inland transport. The export goods
from landlocked European countries like Switzerland may move by LASH or other
inland waterway transports to the port of Rotterdam (Netherlands) or Antwerp
(Belgium), and transfer to the ocean going vessel for the deep-sea voyage.
RADIO FREQUENCY IN LOGISTICS
RFID is poised to be one of the most influential technologies to affect the retail
industry of the future that will radically change the nature of business in the retail
supply chain.
An RFID chip is a small silicon chip that carries limited information and emits data,
either actively or passively using radio waves to identify individual items thereby not
requiring line of sight or human intervention for identification. Readers capture this
information and pass it on to applications which can then process and use this
information providing an all-pervasive view the tagged product through the supply
chain.
In effect RFID would transform every facet of the retail supply chain. It would enable
easy inspection and immediate clearance of goods across all stages of the supply
chain. The need for safety-stock would decline due to reduced lead-time and lead-time
variability. There would be a direct reduction in labor costs, much higher utilization of
assets and elimination of shrink. Also, the customer shopping experience, the post sale
warranties and service programs would be greatly enhanced.
We are keenly following the development and adoption of this technology. A working
group of cross functional specialists is working to identify areas of application
development, infrastructure development and other capabilities which will help us to
service our clients better. We have started working with a major retailer on their first
RFID project thus becoming one of the very first companies in the world to have
worked in this area.
Some statistics about INLAND WATERWAYS TRANSPORT
For transporting food grain, it costs
Rs. 1.50 per ton/per km carried on the railways,
Rs. 1.20 per ton/per km carried on the roads,
Rs. 0.90 per ton/km carried on the waterways.
In addition, IWT is extremely energy friendly:
A 10-ton truck needs 550-600 litres of diesel to drive from Kolkata to Jorhat.
Compare this to a 1,500-ton barge, which can carry the equivalent of 150 such trucks
and consumes 35 litres of diesel for every kilometre (70,000 litres of diesel for the
same distance). If 150 trucks were to travel this distance, they would consume the
equivalent of 90,000 litres of diesel. This is a substantial saving and IWT should be
promoted just for this one reason.
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(BTU/Tonne-KM)*
Consumption
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Road ……..1587.3, Waterways……182.0, Railways (Electric Traction)……84.6
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BTU is British Thermal Unit
Distribution of internal effort for freight over various modes
Bt km %
share

Road 449 51.7

Rail 248 32.7
Pipeline 70 8.1
Coastal 66 7.6
shipping
869 100
of demand for road transport are very weak and are hardly reliable. The problem is
quite serious, given that road transport is the primary mode of transportation today.
With the Indian economy expected to grow at around 6 per cent per annum, the transport sector, both
passenger and freight, is expected to grow at 7.5 per cent.
The efficiency of the system bears upon the effectiveness with which it runs 11,000
trains daily round the clock, transporting goods and people over a massive stretch of
nearly 63,000 route kilometers.
Railway system is six times more energy efficient than the roads. It is environment
-friendly and economical. The Rail share in total freight traffic, presently, is 40% and
plans are afoot to increase it to 60%. This will result in considerable savings in the
diesel. Railways have electrified 13,500 route kilometre of high traffic density, which
accounts for 21% of total route kilometres, 60% of freight traffic and 48% of
passenger traffic.
India has inland waterways with a navigable length of 15544 km

COMPARISON OF TRANSPORTATION MODES

 RAIL ROAD WATER AIR PIPE
LINE
CAPITAL EX II IV III V HIGHEST I
OPERATING III II IV I V
COST
SYSTEM KM 63,000 15,03,000 15544 5000 KM
Route KM Km[IWT]
Kilometers
TONNE KM 284 Billion 585 66 BTKM 70 BTKM
Tonne KM Billion [Costal
Tonne Shipping]
KM
SPEED III II IV I V
AVAILABILTY II I IV III V
[ability to serve a
set of locations]
DEPENDABILIT III II IV V I
Y [minimum
deviation from
schedule, weather,
congestion& other
problems]
CAPABILITY II III I IV V
[ Capacity to
tackle any size of
the load]
Frequency IV II V III I
[quantity of
scheduled
movement]

ISO containers are used for the intermodal transport of freight. They are manufactured
according to specifications from the International Standards Organization (ISO) and
are suitable for multiple transportation methods such as truck and rail, or rail and ship.
ISO containers are manufactured in many sizes. The standard width is 8 ft. The most
common lengths are 20 and 40 ft. Other lengths include 24, 28, 44, 45, 46, 53 and 56
ft. All ISO containers include a container safety certificate (CSC) issued by the
manufacturer that must be renewed every 30 months by a certified inspector. If
necessary, an approved continuous examination program (ACEP) can be used in place
of this procedure.
There are several basic types of ISO containers. Dry or cube containers are front
loaded, completely enclosed and suitable for general-purpose transportation. Standard
containers are 8 ft., 6 in. tall. By contrast, extended height or high cube containers are
9 ft., 6 in. tall. Insulated or thermal containers are suitable for transporting chilled and
frozen goods, as well as temperature sensitive materials and products. They have
insulated walls, but are not refrigerated like electrically-powered reefer containers.
Flat racks and platforms are ISO containers that are used to transport heavy
machinery. They do not have side walls, but may have end bulkheads and are often
collapsible. Open top containers are shaped like a box and loaded from either the top
or end. They are designed to carry heavy, tall or hard to load materials such as coal or
grain. Tank containers are built to the same standard dimensions as other ISO
containers, but are cylindrical vessels mounted in a rectangular steel framework.
Typically, these containers are used to transport liquid or bulk materials.
ISO containers are available with many special features. Some containers are airtight
or stackable. Others are designed for storing and moving flammable, corrosive,
explosive, or other hazardous materials. Containers that are shielded against
electromagnetic interference (EMI) and radio frequency interference (RFI) are often
used in the transportation of electric and electronic products. Vented ISO containers
with ducts along the side panels and top and bottom rails are suitable for replacing
warm, moist air with colder, ambient air. Often, desiccants such as silica-gel are used
in the transportation of high moisture products such as coffee beans or other
foodstuffs.
CARRIEIR TYPES:
Private Carrier, Public Carrier, Contract Carrier, Exempt Carrier. Exempt carrier is the
one who is exempted from economic regulations. Traditional exemptions are for
special commodities and special zones. But such carriers must comply with licensing
and safety requirements of states

LOGISTICAL REENGINEERING
BPR is a process of reengineering the business process for improving the productivity
with focuses on rethinking work from the ground up, eliminating work that is not
necessary and finding better, more effective ways of doing work.
Reengineering is not simply about making an organization more efficient. You can have
the most efficient organization in the world, but unless it effectively serves its customers,
in essence, accomplishes its mission, it is still of no value. Reengineering is about
creating value for the customer. Value may be defined by the customer as lower cost,
higher quality, or increased response time.
Logistics has the objective of creating customer value at minimum cost. Logistical
reengineering is looking at the logistical process from customer’s perspective and
identifying low value areas for improvement.
Some features of reengineering:
Systems integration: Systems integration is the systems approach used for problem
solving. Problem is conceptualized, as the system output for solving which right
subsystem is required to be identified and scrutinized for erring part or element. When
we see logistics as product delivery system, customer value is the output of the system.
Any problem here should be traced to respective function or functions and functional
activity for correction.
Benchmarking: best practice parameters are targets for achieving and surpassing
ABC: activity based costing is a means to identify correctly resource consumption for
improving productivity
Quality initiatives: reengineering is a quality initiative adopted by many organizations
for logistical quality improvement
Reengineering procedure
Step I: Target identification: clear cut picture of the parameter selected for
improvement. Current position and desired position are identified with respect to the
parameter chosen for improvement.
Step II: Detailing metric development: detailed study of the process that produces the
problem output for identifying areas for improvement. Process mapping or value stream
mapping is a known method for this purpose
Step III: Internal analysis, External benchmarking: the redesign of the process to meet
the objective must be best suited for the organizational needs. Various alternatives can
be evolved by creative thinking within the organization or by looking outside for best
practices.
Step IV: Evaluation: evaluating developed options in terms costs and benefits for the
organizations
Step V: Implementation: carrying out necessary tests and trials before implementation.
Identifying training needs and providing training accordingly. Finally putting in place
the changed process for improving logistical quality.
Logistics and 6 sigma
6 Sigma is a modern quality initiative applied in many organizations to improve product
quality. As all quality initiatives like TQM & TPM reached logistical management
6 Sigma also traveled to logistical management.
We know that logistical quality is measured by perfect orders. Any deviation from
committed time, place and quantity parameters is a defect in logistics.
Apply the six sigma steps of Deploy, Measure, Analyze, Improve and Control as
explained in the class.
If you systematically analyze logistical quality defects and apply ABC analysis you can
identify the current high weightage defects.
Now conduct a systematic sampling of all customer orders for a definite time span.
Average defect rate is the mean, and the emerging defects or deviation pattern can be
plotted on a control chart.
As you set the limits for control chart at 1 sigma, you will find every order with defect
rate beyond 1 sigma from the mean significant.
Apply corrective and preventive measures on these defects and eliminate them. Now the
bar gets raised to 2 Sigma as defects in this region vanish. Eliminate these defects, bar
goes up and in due course of time limits become 6 Sigma. At this level PPM become 3.4
The above analysis refers to one kind of identified defect. Once this defect vanishes u
have to go after another or u can do this simultaneously. But all defects must be taken to
the root cause for corrective and preventive action.
This makes the organization superior in terms of logistical quality
EXPLAIN LEAD TIME ( BUYER AND SUPPLIER FACTORS)
Lead-time is an important parameter that determines the effectiveness of customer
satisfaction process. One of the current challenges in the market is demand for lower
lead-time. As this effects the inventory levels and thereby all customer expectations like
cost and delivery. Reduced lead times are fundamental need of a JIT to raise inventory
turn over ratio.
1. Lead time is the time between order placement and shipment receipt from customer’s
perspective
2. Lead-time when viewed from supplier's perspective is the time between order receipt
and order shipment also called ‘order cycle time’. This cycle is made up of several
factors, which are listed below
Buyer related factors are
1. Acceptable inventory levels at buyer's place. When buyer wants low inventory level at
his place his demand for short lead-time is strong
2. Inventory value. Money blocked in inventory is high when inventory value is high.
Hence need for small inventory at short lead-t time
3. Stock-out risk. If this is high short lead-time is demanded
4. Order placement by buyer: when is the order placed? This is a factor that influences the
lead-time needed by the supplier. As buyer places order this is a buyer-related factor.
Supplier related factors are
1. Order processing time: editing the order for credit balance, acceptability of the order,
entry of the order in sales records and sending instructions to inventory points and
preparing shipping documents
2. Order preparation: making the inventory ready for shipment: identification, handling,
packing labeling etc. this time component is significant which can be reduced by advance
instruction
3. Order shipment: time between the order placement on the transport vehicle for
movement and receipt of the goods at the customer's place
modern information system has considerably reduced the lead time. but this is a two way
process between the buyer and supplier