Logistics and Supply Chain Management

357 Pages·2022·12.071 MB·English

by  Martin Christopher

Praise for Logistics and Supply
Chain Management
‘Major world events in recent years – ranging from the Covid-19 pandemic, blockage of
the Suez Canal and war in Ukraine – have highlighted the critical role played by logistics
and supply chain management in the global economy and have brought these subjects
to the forefront of public interest. This important book by one of the leading thinkers in
the field is essential reading, not just for practitioners and students of these subjects,
but for everyone with a keen interest in how logistics activities and supply chain designs
shape our everyday lives. The clear text and logical flow of chapters, augmented by a
range of interesting and diverse case examples, take the reader on a journey of discov-
ery into how today’s supply chains should be structured and managed.’
Professor John Mangan, Chair in Marine Transport and Logistics,
School of Engineering, Newcastle University, UK
‘It should not have needed a global pandemic and a war in Europe to raise the
importance of building and managing resilient supply chains. The techniques to achieve
this are not new; achieving value has always been the goal, and the latest edition of
this excellent book lays these out in a clear and compelling manner. It is updated to
embrace digitisation, and to address the sustainability imperative, and is set in today’s
context of volatility and disruption. Procurement and supply chain professionals can
learn from this book as part of their continuing professional development.’
Malcolm Harrison, CEO, Chartered Institute of Procurement and Supply
‘Since the first edition was published thirty years ago, this book has become one
of the leading texts on logistics and supply chain management, providing guidance
both to students and practitioners. The author provides valuable insights into how
performance in these vital business processes can be improved and sustained.’
Yossi Sheffi, Eliza Gray II Professor of Engineering Systems, MIT, USA
‘Martin Christopher’s latest book captures the entire evolution of logistics and
supply chain thinking and associated concepts through to current times, including
digitisation, new business models, sustainability, and perspectives on what we can
expect to see in the years ahead. It is comprehensive and beautifully illustrated with
examples and short case studies. A must-read for students and managers alike.’
Dr John Gattorna, global supply chain ‘thought leader’ and author
‘Excellence in supply chain management is imperative in today’s commercial
environment. It is the heartbeat of the enterprise, significantly influencing its
success / failure and, when orchestrated correctly, will assure the right balance of
growth, cash and cost.
The utopia of supply chain excellence requires transparency, real time visibility,
collaboration and digital integration end to end to empower relationships with
customers and suppliers, thus facilitating optimal fulfilment and perfect order
achievement. In this valuable guide the author addresses how end-to-end
processes, systems, tools and competencies must be designed and managed to
achieve success in the marketplace.’
Stuart Whiting, Senior Vice President, Logistics and Planning,
Global Supply Chain, Schneider Electric
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Logistics & Supply
Chain Management

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MARTIN CHRISTOPHER
Logistics & Supply Chain
Management
Sixth Edition
Harlow, England • London • New York • Boston • San Francisco • Toronto • Sydney
Dubai • Singapore • Hong Kong • Tokyo • Seoul • Taipei • New Delhi
Cape Town • São Paulo • Mexico City • Madrid • Amsterdam • Munich • Paris • Milan

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PEARSON EDUCATION LIMITED
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United Kingdom
Tel: [phone]
Web: www.pearson.com/uk
Previously published 1992, 1998, 2005, 2011 (print), 2016 (print and electronic)
Sixth edition published 2023 (print and electronic)
This sixth edition © Martin Christopher 2023 (print and electronic)
The right of Martin Christopher to be identified as author of this work has been asserted by him in accordance
with the Copyright, Designs and Patents Act 1988.
The print publication is protected by copyright. Prior to any prohibited reproduction, storage in a retrieval sys-
tem, distribution or transmission in any form or by any means, electronic, mechanical, recording or otherwise,
permission should be obtained from the publisher or, where applicable, a licence permitting restricted copying
in the United Kingdom should be obtained from the Copyright Licensing Agency Ltd, Barnard’s Inn, 86 Fetter
Lane, London EC4A 1EN.
The ePublication is protected by copyright and must not be copied, reproduced, transferred, distributed,
leased, licensed or publicly performed or used in any way except as specifically permitted in writing by the
publishers, as allowed under the terms and conditions under which it was purchased, or as strictly permitted
by applicable copyright law. Any unauthorised distribution or use of this text may be a direct infringement of
the author’s and the publisher’s rights and those responsible may be liable in law accordingly.
All trademarks used herein are the property of their respective owners. The use of any trademark in this text
does not vest in the author or publisher any trademark ownership rights in such trademarks, nor does the use
of such trademarks imply any affiliation with or endorsement of this book by such owners.
Pearson Education is not responsible for the content of third-party internet sites.
ISBN: 978-1-292-41618-2 (print)
978-1-292-41619-9 (PDF)
978-1-292-41620-5 (ePub)
British Library Cataloguing-in-Publication Data
A catalogue record for the print edition is available from the British Library
Library of Congress Cataloging-in-Publication Data
Names: Christopher, Martin, author.
Title: Logistics and supply chain management / Martin Christopher.
Other titles: Logistics and supply chain management
Description: Sixth Edition. | Hoboken, NJ : Pearson, [2023] | Revised
edition of the author’s Logistics & supply chain management, [2016]
Identifiers: LCCN 2022042551 | ISBN 9781292416182 (paperback) | ISBN
9781292416205 (epub) | ISBN 9781292416199 (pdf)
Subjects: LCSH: Business logistics--Cost effectiveness. | Delivery of
goods--Management.
Classification: LCC HD38.5 .C46 2023 | DDC 658.5--dc23/eng/20220919
LC record available at https://lccn.loc.gov/2022042551
10 9 8 7 6 5 4 3 2 1
26 25 24 23 22
Cover designed by Michelle Morgan, At the Pop, Ltd
Front cover image © Toria/Shutterstock
Print edition typeset in Helvetica Neue LT W1G 9.25/12 by Straive
Printed by Ashford Colour Press Ltd, Gosport
NOTE THAT ANY PAGE CROSS REFERENCES REFER TO THE PRINT EDITION
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To Margaret
vii
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Contents
About the author xiii
Preface xiv
Publisher’s acknowledgements xv
1 Logistics, the supply chain and competitive strategy 1
Supply chain management is a wider concept than logistics 2
Competitive advantage 4
The supply chain becomes the value chain 9
The mission of logistics management 10
The supply chain and competitive performance 12
The changing competitive environment 13
2 Delivering customer value 25
The marketing and logistics interface 26
Delivering customer value 27
What is customer service? 28
The impact of out-of-stock 30
Customer service and customer retention 32
Market-driven supply chains 35
Defining customer service objectives 39
Setting customer service priorities 43
Setting service standards 47
3 Going to market 51
Distribution channels are value delivery systems 52
One size doesn’t fit all 55
Innovation in the distribution channel 56
The omni-channel revolution 58
The personalised supply chain 62
4 The financial impact of logistics 65
Logistics and the bottom line 66
Logistics and the balance sheet 67
Logistics and shareholder value 69
Logistics cost analysis 74
The concept of total cost analysis 75
Understanding the cost-to-serve 78
Customer profitability analysis 79
Direct product profitability 84
Cost drivers and activity-based costing 86
viii
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5 Matching supply and demand 89
The lead-time gap 90
Improving visibility of demand 91
The decoupling point 93
The supply chain fulcrum 94
Forecast for capacity, execute against demand 96
Demand management and planning 96
Collaborative planning, forecasting and replenishment 100
6 Creating the responsive supply chain 105
Using the volume/variability matrix 108
Product ‘push’ versus demand ‘pull’ 111
The Japanese philosophy 116
The agile supply chain 117
The foundations of agility 120
A routemap to responsiveness 125
7 Strategic lead-time management 129
Time-based competition 129
The concept of lead-time 133
Logistics pipeline management 137
Reducing logistics lead-time 141
8 The synchronous supply chain 149
The extended enterprise and the virtual supply chain 150
The role of information in the virtual supply chain 152
Laying the foundations for synchronisation 155
‘Quick response’ logistics 157
Production strategies for QR 160
Logistics systems dynamics 161
9 Developing and managing the supply network 167
The transition from purchasing to strategic sourcing 169
Segmenting the supply base 172
Category management 174
Agile procurement in an uncertain world 179
10 Complexity and the supply chain 181
The sources of supply chain complexity 182
The cost of complexity 188
Product design and supply chain complexity 189
Mastering complexity 190
11 Managing the global pipeline 195
The globalisation of supply chains 197
Gaining visibility in the global pipeline 201
CONTENTS ix
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