Logistics refers to the transport setup in the organization. A company that does not manage logistics properly will not be able to reach the customers in time or even receive the raw materials from the suppliers. The operation of logistics could be more complicated in bigger organizations that use hundreds of lorry trucks and even other forms of transport like airways and shipping. ERP helps in setting up a common database that helps to trace the status of "goods in transit". ERP logistics software helps in conveying this vital information to all stakeholders and others dealing with the company. ERP Logistics software has helped in achieving that.
Benefits of ERP for Logistic industry
Logistics management is critical for any setup that deals with movements of physical goods and resources. ERP logistics software helps the companies to perform logistics functions easily and at a reduced price.
Some of the benefits of ERP for Logistic industry programs are as follows:
Operational efficiency
The very purpose of logistics is to supervise transportation and associated function. Anybody in the department should be able to say the status of a good at a particular point of time. This will make the logistics function more meaningful. Organizations have never found this happening on many occasions.
The typical problems could be something like this. The persons in charge of the goods in transit would not have conveyed the status to the concerned person. Even if it was conveyed it would not have been recorded properly and periodically. The main slag lies in information coordination.
These can be solved through a centralized database system like ERP.ERP ensures that there is no lacuna in communication part as things are entered automatically into the systems. The manual operations are definitely not devoid of errors and it could cause havoc on the fortune of the company especially when there is a miscommunication.
ERP logistics software makes a note of the movement of goods as and when they take place. Since they are entered at several outlets it becomes accessible everywhere. This ensures there is no discrepancy in recording the status of goods. The information can be crosschecked repeatedly. Such counter checking will help in identifying the errors if any.
Monitoring vehicles
Companies always found it equally difficult to maintain vehicles so as keeping a track of them because the former cannot take place if the later is not done properly.
Why monitor vehicles?
Logistics also includes managing vehicles. An organization could have various modes of transports for dispatching and receiving its consignments. Companies that have a specific logistics department own trucks and Lorries or avail the services of travel agents. Bigger organizations could also own cargo ships. The mode of transport and the modalities of operating them purely depend on the financial soundness of the organization and relevant factors like geographical location of customer and deadlines for delivering the products.
Companies resorting to transport facilities from outsiders
When a company makes use of railways or air transport or other modes of transport the burden or the question of maintaining vehicles do not arise. On the other hand they have to play a vital role in aspects like applying and renewal of licenses, comply with the safety standards and other mandatory requirements and coordinate with the freight authorities in matters like payment of bills and preparing vouchers. It might seem that ERP may have a lesser use because the control goes beyond the organization. On the contrary the fact is that the freight authorities become another party to the ERP database. The companies can make an arrangement with them in such a manner that they are able to share the freight and relevant details of the organization. The same case will apply in the case of third party travel agents. ERP logistics software will facilitate connectivity and integration in all these areas mentioned above.
Managing company owned vehicles
When it comes to the question of vehicles owned by the companies (like trucks Lorries or autos or any other locomotives for that matter) another important task lies with the logistics department. They have to monitor and manage the vehicles as well. This task is not easy as envisaged. The company may posses hundreds of vehicles and it is difficult to know the standards of each one at a particular point of time. As the number of vehicles increases the difficulty also increases. It is important to maintain those vehicles because they are the backbones for transportation.
Above all they are the assets of the company. Repairing and overhauling are inevitable when it comes to vehicles. It is not possible to forecast them. Hence any interruptions are bound to disturb the transportation process. It is absolutely necessary to record them at appropriate places. Only then the stakeholders can be informed of the status, delays and the reasons for these delays. ERP logistics software not only helps in tracing the status of goods but also serves in informing the status of the vehicles in terms of physical conditions at the appropriate intervals though the common database.
Communicating with other departments
The department of logistics needs to regularly update and answer queries raised by the others. Since they deal with movement of goods their services are required for everyone right from purchases department to sales department and others. Prior to ERP intervention there was no proper means of supplying the required information to the companies because the logistics department themselves are not aware of the status of the goods at all times. Even if they were aware it required a lot of maneuvering and procedural delays in eliciting the required information. Some of the factors were beyond the control of Logistics department themselves. ERP logistics software has removed these drawbacks in two ways. Firstly it had done away with the inherent defects of the logistics department itself. Secondly it has paved way for the other departments to obtain the required information from logistics department without even contacting them as everything is available in the common database setup by the company.
Conclusion
ERP for Logistic industry has revolutionized erp operations. The success of ERP logistics software is by and large a group effort. There should be perfect coordination from everyone concerned with transportation.
