Advancements in supply chain analytics and processes have made it much easier for shippers to gain control of the shipping process, using logistics. Logistics refers to the management of the flow of items from an origin point to the destination. Typically, logistics integrates information, transportation, warehousing, packaging, security, and several other elements of the shipping process. Obtaining more information about the shipping process allows logistics shipping companies to gain more insight into what is working and what it not.
One way that companies gain more information about the shipping process is by performing a logistics audit. The purpose of this procedure is to objectively audit the entire supply chain process to uncover any waste and inefficiencies. This article will take a look at the steps that are used by logistics shipping companies to carry out this evaluation.
1. Observe the organization's operational processes
Before logistics shipping companies provide a proposal, they will spend a few days interviewing the organization's leaders and making general observations to acquire background information about the organization. The accumulated knowledge is then drafted into a proposal for the organization.
2. Align supply chain strategies with organizational objectives
The company performing the logistics audit will use knowledge of organizational objectives to create metrics that can be used when formulating supply chain strategies. This step also entails reviewing the relationships between departments to make sure that the company is structured in a way that allows organizational objectives to be met. The company will also be sure to quantify key logistics sources across the departments, including transportation management, productivity management, distribution centers, logistics integration, and global supply chain visibility.
3. Negotiate the service agreement
In this step, the organization will finally sit down with logistics shipping companies to negotiate what work will be performed and at what rate.
4. Logistics audit process
Now the moment that the organization was waiting for: the audit. The consulting company will use this time to develop and implement a method of data collection. Metrics related to current operations are collected and analyzed at this time, while departments ranging from labor and resource management, transportation, and supply chain visibility are managed. The company will then analyze the collected data and look for hidden logistics values that can be tapped into with operational changes.
5. Logistics audit results are reported
The consulting company presents its findings to the shipping organization and makes suggestions for technology that should be implemented.
6. Implementation
Once the audit results have been reported, the shipping company will start implementing the changes that were proposed.
7. Post-implementation logistics audit
This is one step that organizations neglect to complete. After implementing changes, the organization should confirm that the changes had their desired effect. If not, they can perform another audit to tackle any lingering issues.
These duties will all be handled at some point, but the order varies between different logistics shipping companies. Additional questions related to a logistics audit can be answered by reaching out to a supplier of logistics analytics today.
Allowing logistics shipping companies to complete a logistics audit will help shippers to regain control.
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