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Logistic engineering

Logistic Engineering deals with the science of Logistics. Logistics is about the purchasing[?], tranportation[?], storage, distribution, warehousing[?] of raw materials, semi-finished/work-in-process goods and finished goods. How to manage all these activites efficiently and effectively for an organisation satisfying some widely accepted performance measure is the main question at the back of the mind of any logistic engineer.

The most popular and widely used performance measure[?] is the total cost. The total cost of purchasing, transporting, warehousing and distributing raw materials, semi finished and finished goods.

Another performance measure equally important is the end customer fillrate[?]. It is the percentage of customer demand which is satisfied immediately off-shelf. How much ever efficient the logistics processes are, unless it is of use to the end customer, the logistic process does not have much effectiveness. All the processes you are doing are for the end customer. The end customer can be the process just upstream, may be the shipping or the warehouse where items are stocked or can even be the final customer who is going to finally use the product.

Another much more popular derivative and a complete usage of the logistic term which has appeared in recent years is the Supply Chain. The supply chain more than looking only at the manufacturing and immediate purchase and distribution processes as in logistics, also looks at an efficient chaining of the supply / purchase and distribution sides of an organisation. While Logistics looks at single echelons, with the immediate supply and distribution linked up, supply chain looks at multiple echelons/stages, right from procurement of the raw materials to the final distribution of finished goods upto the customer. It is based on the basic premise,that the supply and distribution activities if integrated with the manufacturing / logistic activities, can result in better profitability for the organisation. The local minima of total cost of the manufacturing operation is getting replaced by the global minima of total cost of the whole chain, resulting in better profitability for the chain members and hence lower costs for the products, benefitting the society in the long run.



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