Monday, March 2, 2009

What is logistics?

I remember back in the early 90's, the editor of the Journal of Commerce invited me to lunch. I figured he asked me to lunch because I was one of the few female professionals in the business.

I guess that was only part of it. I think the real reason for our lunch, was to ask me the question "what exactly is logistics?". I can assume he wanted to ask me this question, so as not look stupid to one of the guys.

But it is a very confusing area. I googled it, and found one site which gives this as it's primary definition "Logistics means having the right thing, at the right place, at the right time." That's pretty good for putting it in a nutshell.

Here's one that is more typical of an official explanation.

Logistics - ...the process of planning, implementing, and controlling the efficient, effective flow and storage of goods, services, and related information from point of origin to point of consumption for the purpose of conforming to customer requirements." Note that this definition includes inbound, outbound, internal, and external movements, and return of materials for environmental purposes. -- (Reference: Council of Logistics Management)


The reason I thought of this was because today, China announced they are investing in logistics. I thought "great, they will build more railroads, roads, etc". But I'm not really sure. This is what they say they will do.

The plan will cover nine areas: Construction of transportation facilities; logistics parks; urban delivery; logistics for bulk commodities and agriculture products; interaction between manufacturers and the logistics sector; promotion of logistics standards; a public information platform about logistics; logistics technology, and emergency logistics.


I'm guessing it just didn't translate well. Or, they are now learning from their American counterparts - how to sound like you are doing something, when you don't know what the heck you will really do with that money. Other than give contracts to your friends.

If anyone needs a logistics consultant, let me know.

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