“Logistics management is concerned with the efficient flow of raw materials, of work in process inventory, and of finished goods from suppliers to consumers” (Goudin, 2010). The different stages that raw materials and finished products have to go through to or from a company entail many other processes such as warehousing, processing orders, and other information activities, all of which make part of logistics management. How all these processes are managed will many times influence the quality of products and customers’ accessibility to them. Globalization has today meant more complex logistical challenges, but new technologies continue to make it more manageable.
Nokia is among the companies with a wide global presence and complex logistical needs. It needs a logistical strategy that will spur its growth and encourage the development of a modern and efficient logistical infrastructure (Nokia Corporation, 2010). The company has a presence in 120 countries and has to avail its products to all these markets on time. Companies contracted to do Nokia’s production and all its employees have to be managed in a way that allows the company meets its objectives.
The role of planning
Planning is a key part of logistical management. The scope of logistics management is very wide and runs across many stages of the value chain. Nokia has to manage supplies from different parts of the world such as packaging materials and other office supplies. A big part of its logistics management is made up of information management, considering its large market presence in over 120 countries and over 123,000 employees. Planning and organizing its markets into different groups allows the company divides its logistics management into smaller markets, making it easier to manage.
Every mission intended to be achieved through logistics is by proper planning. “Planning provides an interface between marketing and customers, marketing and operations, operations and suppliers” (Waters, 2003). Nokia has made this possible by utilizing available technologies to ensure synchronized operations in all its markets. Sharing real-time information among different markets across the world ensures well-planned schedules for employees’ training, production, transportation, and order deliveries.
Logistical management in Nokia is made possible through planning. It is through planning that Nokia can have a competitive edge, especially in such changing, competitive and wide markets. For such a big organization, handling information can be hectic and inaccurate without proper planning and organization. Knowing when products have been released and when they are due for delivery may be challenging without real-time information, which can only be made through proper planning and transport schedules.
Planning gives Nokia an avenue for cost reduction through proper utilization of time. When raw materials and finished products are where they are supposed to be at the right time, production and supply become consistent. Finished products are available to the consumer when they need them, which promotes sales and reliability of the company. It saves the company costs incurred due to insufficient stocks in a market. Delivering the wrong products to the wrong market can cost the company a lot of money in transportation costs and sometimes damages caused by products overstaying in the warehouses.
Nokia has utilized planning in its logistics management by focusing on selective activities. This has been made possible by diving the company’s operations into different departments. For example, “Nokia’s markets unit is responsible for its supply chains, sales channels, brand, and marketing functions of the company, and is responsible for delivering mobile solutions and mobile phones to the market” (Nokia Corporation, 2010). The transportation department is fully responsible for the schedules of the vehicles, collection of supplies, and delivery of finished products in different markets. In so doing, each unit has a few responsibilities to plan on and hence upgraded quality.
Planning has given the company a value advantage through superior logistical management. “The purpose of planning in logistics management is to ensure that each machine and workstation is being fed with the right product in the right quality and quantity at the right time” (Waters, 2003). The concern in planning is not the transit process itself, but to synchronize and streamline the process of ensuring products are on the shelves when needed. In production, planning is applied to ensure that the necessary changes are made on time, raw materials are available promptly, production volumes meet the market demands, and available opportunities to improve quality are utilized on time.
Logistics play an important role in achieving an accurate customer response. Nokia has excelled in customer response through proper planning and very accurate logistics management strategies. “The company’s materials management, distribution, channel, supply chain, and logistics management has been made possible by proper planning and planning technologies” (Nokia Corporation, 2010). We can therefore conclude that Nokia has maximized its logistics efficiency through planning.
Goudin, K.N. (2010). Global logistics management: A competitive advantage for the 21st century. Malden, Mass [u.a]: Blackwell.
Nokia Corporation (2010). Nokia in brief. Web.
Waters, C.D. (2003). Global logistics and distribution planning: Strategies for management. London: Kogan Page.