?Work together? to make logistics move forward
Logistics and supply chain management has become a strategic tool to boost a company’s
competitive edge. But not every case is a success. The failure, in local logistics’ expert Dr.
Kumnai Aphiprachasakul’s view, lies in the lack of thorough understanding of logistics, a lack
of technology information system and a lack of cooperation within companies.
“Logistics is still quite new to Thai operators,” said Dr Kumnai, president of Logistics Training
and Consultants Co., Ltd. “Some operators still think logistics is about quick transportation
and inventory management.
“Logistics covers a series of activities from sales prediction to after sales service. It
includes sales forecasts, production planning, purchasing, packaging, transportation,
inventory management, and after sales services.
“These activities must be carried out continuously and smoothly. If there is an interruption at
any point of the whole process, it will cause extra stock in the warehouse, increasing the
operation cost,” added Dr Kumnai.
He also found out that Thai operators tend to focus on supply much more than checking for
the true demand. So they often end up with an over supply in the inventory.
Dr. Kumnai pointed out that information technology is key to logistics and supply chain
efficiency, but that local businesses are not equipped with sufficient IT skills.
“IT helps quicken the working process of the whole supply chain to ensure a work,
production and inventory flow to meet Just In Time requirement and reduce stocks in the
warehouse. But Thai operators lack IT skills. There’s a need to improve on this.”
Cooperation is crucial
To integrate the logistics process, most companies prefer outsourcing experts to
design and develop a proper logistics strategy for them to cut their operation costs. It
worked better than when they tried experimenting on their own.
But to make the logistics implementation work, it needs cooperation from different
departments within an organization, according to Dr Kumnai, who has helped providing
logistics solutions to many clients for years. But the working nature of Thai companies poses
“Thai companies encourage competition between departments. Each department tries to
protect their advantage. So implementation of something new often faces resistance. Top
management must make all involved understand the change to win their cooperation from
them,” said Dr Kumnai.
The company must also set target goals and time frames so that managers at different
levels can be trained to better understand logistics. Then the company must develop a
technology system to support its work. This includes investments in hardware, software and
other automation systems.
“The logistics solution is, after all, to benefit the company in the best possible way. It helps the company control operation costs, have a smooth work flow, an efficient inventory management, distribute products with shortest time, have product quality control and provide the best service,” said Dr. Kumnai.