LOGT 4232 Week 2 (Aug 23-25) Class Notes
LOGT 4232 Week 2 (Aug 23-25) Class Notes LOGT 4232
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This 5 page Class Notes was uploaded by Tavish Smith on Tuesday September 6, 2016. The Class Notes belongs to LOGT 4232 at Georgia Southern University taught by Heidi Celebi in Fall 2016. Since its upload, it has received 6 views. For similar materials see International Logistics in Logistics at Georgia Southern University.
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Date Created: 09/06/16
Week 2 – August 23 – 25, 2016 Chapter 2 – International Logistics Historical Development 1. The Early “Slow” Days a. Silk Road: well-traveled trade route, in use for over 3,000 years, stretching from Europe to Asia and passing through the Middle East b. Primarily concerned with ensuring goods arrived at their destination in good condition and at the lowest possible cost c. Following WWII, logistics began to incorporate techniques used by the military d. Logistics began to refer to not just the movement of goods but also to sales, the procurement of supplies, and the management of supplier and customer relationships 2. The move toward speed a. 1950’s: introduction of containers i. Their eventual widespread adoption made shipping much more efficient as well as cheaper and faster b. 1970’s: time-defined air shipping services introduced by new companies (FedEx & DHL) c. 1980’s: air transport became cost-competitive with ocean transport for many products i. International air shipments grew as costs came down and the number of destinations increased 3. The emphasis on customer satisfaction a. The very high interest rates of the 1980s led companies to reduce inventory levels b. New inventory management techniques were created to reduce inventory costs. Those techniques include: i. Just-in-time (JIT): plans for inputs to arrive just before they are needed ii. Materials requirement planning (MRP) iii. Manufacturing resources planning (MRP II) iv. Distribution resources planning (DRP) c. Since these techniques relied on rapid and reliable deliveries, logistics firms provided reduced shipping time and time-defined deliveries 4. The transformation into a strategic advantage a. International logistics management has become a strategic advantage for the firms that are capable of: i. Containing the costs of shipping, in view of increased fuel costs ii. Providing “visibility” in the supply chain, or the ability to determine where a particular shipment is located, at any time iii. Providing reliable, dependable deliveries iv. Ensuring the security of the goods while they are in transit v. Engaging in sustainable practices Benefits: Core Competency: what a company is based on Economies of scale: the more you make, the cheaper it is per product (per unit) Risk Learning curve: measure of how you/a company learns o Number of trials/attempts vs. performance measure o Slow beginning, steep acceleration, plateau Operate 24 hours a day o Able to meet customer demand Chapter 17 – A Strategic Advantage Communication challenges Communicating effectively and accurately Most communications with foreign counterparts are conducted in an impersonal fashion: e-mail, fax, and letters Most international communications take place in English, the native language of only about 5% of the world’s population English has become “everybody’s second language” because it is a relatively easy language to learn Communicating effectively means making sure that the person for whom the message is intended has no doubt about the meaning of the message: The vocabulary is clear and unambiguous: native English speakers should use International English and Special English The units used should be metric The message should be culturally Internationally Native English speakers should strive to make the meaning of the communication absolutely clear to the non-native speaker It is best to use a technique called International English to achieve good communication in written document Internationally English – Rules 1. Always assume that the person for whom English is a second language is relaying on a dictionary for some words 2. Always proofread carefully and avoid all grammatical and spelling errors 3. Always make sure that quantitative information (dates, currencies, etc.) can be understood without doubt a. Always write dates as 14 December 2013. That way no confusion can possibly take place 4. Always use simple and short sentences 5. Never use idioms that are sport or military related, as they are rarely, if ever, understood properly Special English A reduced-vocabulary English developed by the Voice of America, the US government-sponsored news organization that broadcasts worldwide Special English Rules 1. Sentences should be short and contain only one idea 2. The vocabulary should be limited to correct and accurate terms a. NO “like” b. NO “you know what I mean?” 3. The speed at which the sentences are spoken should be slower 4. Repeating a sentence does not mean repeating it louder, but repeating it with different vocabulary Metric System Has been adopted worldwide The measurement system officially followed by almost all countries Since information is better processed when it is familiar, US exporters should utilize the metric system in their communication, as very few foreigners understand the US system of measurement It is advisable that both metric and standard measurements on the packaging used in transportation, so that the dimension and weight are clear to all people involved in the handling of the goods A simple translation of measurements will convey the meaning correctly, but not always clearly It is better to use measurements that are conventional in the country of the importer Cultural Sensitivity It is always advisable to make sure all communications and interactions are made in a culturally sensitive way. Forms of address: it is difficult to offend someone by being too formal, so its best to err on the side of formality Work culture: it is best to assume work life and private life are separate until ample evidence proves otherwise Speed at which people operate in the work place: it is always advisable to mimic the response time received from the importer Work day: they way people typically organize their work day determines when it is appropriate to make contact, particularly by phone. Strategies to allow their companies to gain a competitive advantage The term of payment best suited for the importer o An exporter should choose to display that it is confident in the ability of the importer to pay o If it is unsure about the importer’s ability to pay, it should consider purchasing a credit insurance policy The best choice of currency o Offer all quotes in the importer’s currency The correct Incoterms rules The best possible document preparation o Accurate and timely document preparation and delivery o Thorough and meticulous document preparation The best packaging decision o Good handling in the packaging requirements o Good packaging practices are more expensive August 25, 2016 Five information types 1. Unnecessary 2. General environment 3. Operating environment a. Everything outside of the firm 4. Internal to the firm 5. Missing information Just In Time for the Holidays (Case) Decision maker = Santa Product = toys Unnecessary information = weather, etc. Operating information = five weeks until Christmas, Timmy CDs popularity Internal information = excess inventory (Meower) Missing information o Production o Capacity o Revenue? o Incurred costs o Suppliers? Spike in demand for Timmy CDs and decrease in demand for Meower Solution? o Digital download o Gift cards o Meower + code o Gifts opened on different days Ex: January 7 in Russia o Start creating fads o Elves visit playground
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