Why Systems And Processes Can Be Impediments To Or Facilitators Of Logistics Excellence

Facilitators of Logistics Excellence

The question whether systems and process can become agents of impediment or facilitators of logistics excellence will provoke several levels of responses for or against it. The truth is that there are several explanations or reasons why they either obstruct or enable logistics excellence, but we must first briefly examine the dimension and potency of systems and processes in determining logistics excellence.

Systems constitute Information/Communication Technology (ICT), Quality Management Systems (QMS) and procedures designed to facilitate business excellence and improve or maintain customer satisfaction and retention.

Processes define key tasks from sales, Commercials, file opening, invoicing Operations, file closing, Customer engagement – including after sales Relationship Management, with predictable outcome.

Systems and processes can be facilitators of or impediments to logistics excellence – depending on how a combination of the following factors are either deployed or managed:

• Knowledge
• Technology
• Organizational Structure
• Process Execution
• Human Resources

Knowledge: This is largely about having people who know what to do, how to do it and when to do it, leveraging established systems and processes in line with expected results and corporate objectives. For instance, you can have a fantastically designed and clearly defined Supply Chain system and process and still not be efficient or able to deliver excellently if the organization or designated individuals lack the requisite knowledge to them to effective use. That is why organizations must groom or hire people with the requisite knowledge or ability to interact with established systems and processes to facilitate logistics excellence.

Technology: Technology facilitates the necessary linkages between parties involved in logistics processes and enables the effective flow of information relating to the movement of shipments from one point to another. Companies across the world are leveraging technologies such as cloud-based software, automation, and data analytics to predict market trends, to be able to compete effectively. While technology itself facilitates logistics excellence, its failure, misuse or under-application can become an impediment to logistics excellence.

Organizational Structure: When organizational structure (People, resources, reporting/communication lines, cross-purpose relationships, job functions of decision making, information flow and customer service) are centrally coordinated, logistics excellence is easily achieved due to the synergy of purpose and better control of activities that facilitate it. Though centralized structures are better facilitators of logistics excellence than decentralized structures, the absence of both can be catastrophic. In other words, organizations must operate within the scope of clearly defined structures and must be able to determine whether such structures are facilitators of or impediments to established systems and processes. And where systems and processes are either not clearly defined, poorly executed, or absent, logistics failure will be recurrent.

Process Execution: This is very key because most companies that experience regular failure have clearly defined processes but fall short at execution stage most of the time. The point here is not that failures cannot occur even with clearly defined processes and winning execution plans. The problem is, if the frequency of failure is largely hinged on poor process execution, excellence can hardly be achieved until creatively decisive steps are taken to address the situation. In other words, while efficient processes are key to delivering the desired outcome, manual process execution tie-down resources, induce inaccuracies and hamper transaction flow.

One of the major competitive advantages the top tier global logistics companies have over those in the lower tiers – even in their own indigenous markets (especially in Africa and other emerging economies) is process automation. Process automation reduces manual efforts; promotes accuracy, consistency efficiency, compliance, service delivery excellence and documentation of transaction records for future references.

Human Resources: Human Resources are the key drivers of systems and processes. You need an appropriate blend of experienced, skilled, knowledgeable, and competent people to put systems and processes to the most productive use. However, employees that are either poorly motivated, bereft of the requisite knowledge and skills; not committed to your corporate objectives or cannot effectively interact with established systems and processes will sabotage any genuine effort towards excellence. This means that even clearly defined processes and well-designed systems will be a set of useless investments if the human element is not properly integrated.

In conclusion, systems and processes are interdependent factors required to facilitate and achieve logistics excellence. Technological systems can be very expensive and will require very efficient and creative processes to drive them. Processes that brings everything together under a structured, single plan that is defined across functional departments to guarantee logistics excellence are required to stamp-out potential impediments.

Read more: Operational Excellence in Logistics