The Importance Of Lean Logistics
Today’s global economy, calls for privately owned companies and Government Agencies to identify ways to reduce and/or cut costs through economic efficiencies. Specifically within the Federal Government, several agencies have been tasked with pinpointing areas that have caused a spike in costs. Overall, it is believed that transaction reductions related to logistics and supply chain management to be considered the best viable approach to realizing cost-efficiencies.
Privately owned and operated companies are also recognizing that in order to reduce their logistics and supply chain management costs, they will have to address their current inventory management and operation approaches. Similarly, both entities have begun re-examining their existing logistics and supply chain operations, and discovering innovative ways to approach the future of their supply chain operations within their respective industries. One approach requires companies to adopt what is known as a lean approach.
Lean logistic is a beneficial approach to supply chain management because it allows companies to identify the causes of waste …show more content…
In order to achieve greater efficiency within supply chain operations, companies first need to understand their supply chain operations, and determine what functional areas are wasteful. And from there, they need to take measure to eliminate that waste. Supply chain waste can be looked at as any functional area of the supply chain that does not directly add value (Myerson, 2012). Waste can occur as a result of external supply chain functions or it can occur as a result of internal supply chain functions. Sources of waste can range anywhere from procurement and order processing to warehousing and transportation. “Lean supply chains are focused on eliminating all waste, including time, and to ensure a level schedule (Murphy & Knemeyer, 2015,