Integral Logistics Management — Operations Management and Supply Chain Management Within and Across Companies

1.1 Basic Definitions, Issues, and Challenges

Intended learning outcomes: Produce an overview on terms of the working environment and of business life. Explain service orientation in the classical industry, product orientation in the service industry, and the industrial product-service system. Disclose the product life cycle, the synchronization of supply and demand, and the role of inventories. Produce an overview on supply chain management, the role of planning and control as well as the SCOR model.



When looking for solutions of practical problems, people are not generally concerned about definitions. However, clearly defined terms become essential when we seek to gain an under­stand­ing of the concepts of Integral Logistics Management. First of all, definitions trans­mit a picture of the phenomena under study. They also avoid mis­under­standings that arise because people and companies make varying usage of technical terms. Finally, definitions are indispensable for structured presentation in a textbook that covers a topic in substan­tial detail. However, definitions should not detract from the pleasure of learning new concepts. This section there­fore focuses on the issues and challenges connected with the terms defined.


Course section 1.1: Subsections and their intended learning outcomes

  • 1.1 Basic Definitions, Issues, and Challenges

    Intended learning outcomes: Produce an overview on terms of the working environment and of business life. Explain service orientation in the classical industry, product orientation in the service industry, and the industrial product-service system. Disclose the product life cycle, the synchronization of supply and demand, and the role of inventories. Produce an overview on supply chain management, the role of planning and control as well as the SCOR model.

  • 1.1.1 Important Terms of the Working Environment and of Business Life

    Intended learning outcomes: Produce an overview on terms of the working environment, such as work, task, process, method, object, etc. Explain terms of business life, such as value-added, business process, material, product, service, classical (or conventional) industry, etc. Present terms of the service domain such as customer service, service in the originary sense, service industry, etc.

  • 1.1.2 Service Orientation in the Classical Industry, Product Orientation in the Service Industry, and the Industrial Product-Service System (IPSS)

    Intended learning outcomes: Differentiate between a (primary, ore core) product, a product in a broad sense, and a product in the most comprehensive sense. Produce an overview on industrialization of service. Present the industrial product-service system. Explain product-oriented, use-oriented, and result-oriented services as well as their degree of intangibility.

  • 1.1.3 The Product Life Cycle, Logistics and Operations Management, the Synchronization of Supply and Demand, and the Role of Inventories

    Intended learning outcomes: Produce an overview on the product life-cycle. Differentiate between terms such as logistics, operations, logistic management, operations management, and value-added management. Describe supply, demand, lead time, and costomer tolerance time. Explain the problem of temporal synchronization between supply and demand as well as the role of various kinds of inventories in solving this problem.

  • 1.1.4 The Supply Chain, Supply Chain Management, and Integral Logistics Management

    Intended learning outcomes: Differentiate between a logistics network, a production network, a procurement network, a distribution network, and a service network. Describe the concept of the supply chain. Produce an overview on supply chain management and on integral logistics management.

  • 1.1.5 The Role of Planning and Control and the SCOR Model

    Intended learning outcomes: Produce an overview on planning, in partcular on supply chain planning. Differentiate between production planning and control (PPC) and a PPC system. Present the Supply Chain Operations Reference (SCOR) model. Describe levels 1 and 2 of the actual SCOR model.



Course 1: Sections and their intended learning outcomes

  • Course 1 – Logistics, Operations, and Supply Chain Management

    Intended learning outcomes: Describe basic definitions, issues, and challenges. Identify business partners and business objects. Explain strategies in the entrepreneurial context. Disclose how performance is measured.

  • 1.1 Basic Definitions, Issues, and Challenges

    Intended learning outcomes: Produce an overview on terms of the working environment and of business life. Explain service orientation in the classical industry, product orientation in the service industry, and the industrial product-service system. Disclose the product life cycle, the synchronization of supply and demand, and the role of inventories. Produce an overview on supply chain management, the role of planning and control as well as the SCOR model.

  • 1.2 Business Objects

    Intended learning outcomes: Present business-partner, and order-related business objects in detail. Explain product-related, process-related, and resource-related business objects. Produce an overview on rough-cut business objects.

  • 1.3 Strategies in the Entrepreneurial Context

    Intended learning outcomes: Differentiate between various entrepreneurial objectives in a company and in a supply chain. Explain resolving conflicting entrepreneurial objectives. Describe the customer order penetration point (OPP) and the coordination with product and process design. Produce an overview on the target area flexibility: investments in enabling organizations, processes, basic technologies, and technologies toward personalized production.

  • 1.4 Performance Indicators and Performance Measurement

    Intended learning outcomes: Present the basics of the measurement, meaning, and practical applicability of logistics performance indicators. Describe performance indicators in the target areas of quality, costs, delivery, and flexibility. Produce an overview on performance indicators of the primary entrepreneurial objective.

  • 1.5 Summary

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  • 1.6 Keywords

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  • 1.7 Scenarios and Exercises

    Intended learning outcomes: Describe improvements in meeting entrepreneurial objectives. Differentiate between entrepreneurial objectives and the ROI. Assessing the Economic Value Added (EVA) of Supply Chain Initiatives. Derive rough-cut business objects from detailed business objects.