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What role does Logistics play in an Agile Supply Chain?
Agile Supply Chains focus on minimising three latencies – Demand Latency (catching demand shifts at the earliest), Planning Latency (converting latest demand outlook to supply plans on a fly) and Execution Latency (acting on the latest supply plans without delay).
Logistics has a pivotal role to play in minimising Execution Latency. Most supply chains experience delays in dispatching as per plans. How many hours do we take to send the vehicle out from the time we get the updated plan?
I was working with supply chain leaders of a leading FMCG company who were proud to have reduced it from 48 hrs to 36 hrs. The process involves converting plans to truck wise shipments, calling LSPs to place trucks, time taken for the trucks to report, time delay from gate to loading bay, loading the truck, and paperwork to see the truck out of the premises.
The best in class do it in less than 6 hrs. Quick Commerce companies count it in minutes, the best taking 1-2 minutes for the whole process.
Delays also happen during transit and unloading at destination.
If we want Logistics to contribute significantly to Supply Chain agility, we have miles to go...