Decision Making in Logistics: Problem Identification & Solutions

This report provides a detailed analysis of decision-making in logistics, focusing on logistics network design and the challenges associated with it. It covers key aspects such as group formation, problem identification (including efficiency, cost, expansion, and facility location problems), data analysis, and the importance of management standards like ISO 9001, ISO 14001, ISO 45001, and ISO 27001. The report employs the Root Cause Analysis framework for problem-solving and discusses idea generation, action plans, and ethical considerations. Ultimately, it offers recommendations for improving decision-making processes in logistics to ensure efficiency, customer satisfaction, and reduced chances of failure, while adhering to international management standards.

Decision Making in Logistics

TABLE OF CONTENTS
INTRODUCTION...........................................................................................................................3
MAIN BODY...................................................................................................................................3
Group formation...........................................................................................................................3
Understanding Logistic network design and problem:................................................................3
Identifying problem:....................................................................................................................4
Data analysis:...............................................................................................................................5
Management standard:.................................................................................................................6
Problem solving Framework........................................................................................................7
Idea generation.............................................................................................................................8
Plan for Action.............................................................................................................................9
Ethical considerations................................................................................................................11
Recommendation.......................................................................................................................11
CONCLUSION..............................................................................................................................11
REFERENCES..............................................................................................................................13

INTRODUCTION
The term logistics is commonly the detailed organization and implementation of the
operation which helps to meet the requirements of the customers and cooperation. Decision
making in logistics refers to create a strategic level ideologies and decision to manage the
definite order of customer services and cost. The logistic management is responsible for the
organizing the storage and accurate strategy of the distribution of the goods with appropriate
costing and delivering at the right location time when it can involve the transportation, stock
control, warehousing and such more (Tesfai, Napoli and et.al., 2020). The report will
demonstrate the appropriate decision-making logistics issues and different frameworks for
providing the solution to manage the business in ethical and standard manner.
MAIN BODY
Group formation
Group formation is the process of gathering of the people to create any particular project
and working which can result excellently. While doing the group formation I had given the equal
opportunities to the team members to express their interest of working area which can help in
project making. There are different kinds of roles and responsibilities has been given to everyone
such as data analysis, managing the standards, identifying the issues, solving areas and action
plan. Doing a project in group will help to understand and increase the knowledge efficiently.
Understanding Logistic network design and problem:
Logistic is one of the most important thing for every business organization as this allow
company to manage and store product, managing logistic is challenging part for the company.
Almost every warehouse operative craft network design, this design is sitting, sizing and setting
number of factories, platform and warehouse. Developing stable network design provide
competitive advantage and help company to handle competitive pressure. Logistic design
provider clear idea to company and help them create a strong supply chain, it is very clear that
meeting demand of customer is crucial part for business. Having strong supply chain reduce
distribution cost, satisfy customer and maintain flow of supply (Chen and Schonfeld, 2016).
Logistic network design is beneficial for the company but there are certain challenges they will
encounter during the process.
Taking strategic decision and assuming outcome is crucial for warehouse management
process, every company take certain logistic decision which might become the biggest reason for

failure. Setting factory, warehouse and other facility is costly for the company, decision on
crafting effective logistic design help company to reduce cost that occur in managing and storing
of goods. There are many companies who have their own strong logistic design that allow them
to become market leader, having strong logistic network design is competitive advantage for the
company. There are certain problem and reason is designs itself, for example if company is
planning to add new factory, warehouse and other facility then they have to redesign their
network and change the layout (Cil and et.al., 2016). Apart this logistic network design problem,
there are certain other basic logistic problems which a company have to consider for example:
supply chain problem, health and safety problem and management of goods problem. With
strong logistic network design company can meet demand of logistic management.
Identifying problem:
Logistic network design is key pillar for warehouse operating organization, this network
provides clear design and structure that help company to manage their goods and fulfil demand
of customer (Ding and et.al., 2019). With great benefit, there are great challenges as well.
Logistic network design have strong components such as warehouse, plants and factories.
Logistic network design it self a complex structure, managing each and every component is not
possible for the company, key problem faced by organization, these are:
Efficiency problem: logistic network design is time-consuming because managing warehouse,
factory and distribution channels at once is challenging process. Following network design
become issue for the company because impact supply of goods and impact customer retention.
Network design is time and effort consuming as managing each and every component with 0%
failure is impossible. There are many cases where company fail to meet demand of customer
because, problem of delay can be seen while using this process. However, strong logistic design
is beneficial in management of process but sometimes delay in one component impact whole
process and impact customer satisfaction.
Cost problem: Transportation cost is one of the most common problem in logistic but this
impact network design as well because if company become unable to manage cost occurring in
transportation of goods from factory to warehouse then they might face failure due to higher cost
(Izdebski, Jacyna-Gołda and Wasiak, 2016). Every organization want to reduce transportation
cost with the help of network design but at some point this design become ineffective and cost

higher to the company. Apart from cost there are many other problems related to transportation,
for example lack of collaboration delay goods which impact logistic management.
Expansion problem: strong logistic network design is backbone for every business organization
as this allow, them to properly manage each and every component including warehouse, factory,
supply chain and distribution channels. Expansion is one of the biggest problem company will
face with strong network design for example if company is planning to add new warehouse or
planning to set an factory then they have to change network layout and craft new design that can
meet demand of company. This is major problem in logistic network design where company try
to craft new network which is costly and time-consuming.
Facility location problem: facility location problem is some common but crucial for logistic
network design, it is very clear that company need to consider those locations that can fit into
design allow company to be smoother in managing logistic. Setting facility in right location is
challenging for the company in the process, each and every component of logistic network
design have physical location (Kalinina, Balchik and Barykin, 2018). It is challenging for the
company to create a network between each facility and company consider as location problem
which impact smooth flow of the process.
Data analysis:
Logistic industry is rapidly growing, warehousing and logistic company effectively
contributing in betterment of the country, a logistic network design allow company to reduce
cost and help them to meet demand of the customer (Palacio, Adenso-Díaz and Lozano, 2018). It
is very important for the company to analyse design of their network and perform accordingly,
every important component of the process allow logistic company to become stable. There are
certain importance of logistic network design, these are:
Efficiency: logistic network design provide efficiency to the company, this simply means
company will going tom stay clear in the process of logistic management. It is very clear that
when business organization have more than one unit of production, factor, warehouse and
distribution channel then they need strong network design that can reduce 20% cost. There are
many international brand who have their own logistic network design tend to reduce cost and
save surplus profit of the company.
Customer satisfaction: customer are often satisfied with logistic network design because
company have ability to provide finished goods in expected time period, it is very clear that

delay in goods reduce customer level of satisfaction by 50%. company can not bear such loss due
to delay. Delay occur when company do not have strong network between each and every
components for example factory need to be connected with warehouse so that they can reduce
possibilities of delay.
Reduce chance of failure: logistic network design reduce chances of failure which means
company might be safe because they have strong network that effectively collaborate with each
other, every business organization know that supply goods is challenging part because there is
high cost and high risk of failure. Depending on choice of customer, company need to store those
product that are cancelled by the customer, with strong logistic network design company can
ensure that they meet demand of customer on right time with less chances of failure.
Management standard:
Logistic management is one of the most challenging thing for the business organization,
there are both international and local logistic network design standard that allow company to
follow regulation and certain guideline. Every business organization who perform logistic or
supply chain need to consider these standards to avoid any kind of legal obligation. ISO
(International Organization for Standardization) provide management standard to every
warehouse facility and allow them to distribute goods across nation and region (Valerievna Shtal
and et.al., 2020). ISO management standard for transportation highlight special consideration
like quality, environmental and continuity planning. There are certain ISO which logistic
management company need to consider, these are:
ISO 9001: ISO 9001 is one of the International logistic management standard that allow
management to ensure quality, this simply means company have to be effective in supply goods
with the highest quality avoiding any harm to goods and service. In logistic network design, ISO
9001 ensure that company's strong network meet demand.
ISO 14001: ISO 14001 is another management standard for logistic management process that
allow company to meet environmental demand, this simply means building customer trust and
focusing on legal obligation. In logistic network design, this standard allow company to ensure
that each and every element for example from factor to warehouse, every component of logistic
network design have to meet demand maintaining environment sustainability including reduction
of waste, improve resource efficiency and waste management.

ISO 45001: ISO 45001 is one of the most important thing for the company as this allow them to
ensure health and safety in the process of logistic. Every logistic management company know
that maintaining health and safety is crucial part, they need to avoid any accidental risk that
might impact smoothness of logistic network design (Varughese and Raj, 2017). In logistic
network design, company have to follow RIDDOR (Reporting of Injuries, Diseases and
Dangerous Occurrences Regulation) 2013. logistic management might face issue if they fail to
ensure health and safety at the workplace, this simply means company need to provide all safety
equipment including safety gear and equipment.
ISO 27001: ISO 27001 means ensuring security of data and information, every warehouse
organization know that information is highly confidential for the company for example if they
carry goods then they might have person information of customer which can be stole as it is
highly confidential. Government allow these organization to get ISO 27001 certificate mainly
those company who have logistic network design to manage their components.
Problem solving Framework
The problem solving framework is utilized by the companies to solve their internal issues
by design and implementation of the definite strategic decision and ideologies from which they
can be able to develop and generate their result. According to the mentioned problem of the
decision-making in logistics the Root cause analysis is one of the best and appropriate
framework for providing the better solution the organizations facing the problem in logistics
network design (Janjevic and et.al., 2019).
Root Cause analysis
The model root cause analysis is an approach to problem-solving areas in logistics or
supply chain management which involves the step by step series for identifying the solution and
can deliver the effective results. It is a kind of structured way of evaluation of the problem and
providing the solutions so that the organization can be able to create and make right decision and
can develop their organization at profitable manner.
Collect the evidence: The first step refers to collection the definite and appropriate evidence of
the causes and a brief description so that the company can be able to understand the main issue.
By collecting the evidence the company can be able to understand the major impacts to the
company where they can unable to grow and develop their logistics or supply chain management
in definite manner where the needs and requirement of the consumer are not fulfilled.

Identify the problem: The problem can be anything relation to team formation or network
design where in above report it has been collected that the organization faces the logistic network
design issue. In this kind of issue it is concerned with the number and sites of the warehouses
and manufacturing areas which also includes the customer demands and requirement and
delivery of the warehouses to the manufacturing areas.
Analyse the root cause: The third step refers to evaluate and analyse the root cause of the
problem so that the organization can be able to understand and can take action by changing the
decision and strategies and modifying them appropriately (Jovčić, Průša and et.al.,2019). It is
important to understand that how the issue or problem has been occurred from which the
appropriate solution can be implemented by the company. As, it has been discovered that the
logistic network design is the main cause and issue for the organization due to market structure,
logistics cost and cost of the sales and such more from which this network designing issue take
place.
Find solutions: Now, this factor makes to find out the solution of the problem which has been
stated above the report. There are many common tools which can help the organization to find
out the appropriate solution of the causes. According to the issue, most of the organization
utilizes the brainstorming tool for finding out the appropriate solution of the problem where a
spontaneous contribution of different ideas from different team members and employee can be
received and can deliver the effective solution.
Create final report: After all this process, the organization is required to take an action and
create a final report from which they can analyse and can overcome the issue definitely. The
organization can create an action plan where they can list each person role and responsibilities, a
definite setting of the deadline for each work and also can implement and adopt the force-field
analysis framework for the better approach of the actions (Zhang and et.al., 2020).
Idea generation
Logistics Process Automation: This factor and process have a huge impact on the overall the
business and organization of different sizes and sectors. By generating idea and adopting this can
help the decision-making of the organization in logistics. This process of automation is the
application software to improve the effectiveness and efficiency of the logistics operations from
which the company can be able to enhance the growth (Škerlič, S., 2020). Adopting this process
seems to prevent the major and maximum hurdles and issues in automation. The logistics process

of automation refers to operations within warehouse and distribution areas and can understand
the supply chain engineering and planning system effectively.
To deliver increased agility and less waste: In logistical decision-making, the organization can
adopt the effective idea and strategies by increasing the agility. The organization is also can
adopt the area where optimizing the distribution network and by reducing delivery cost can help
the company to make an appropriate ideology to take an action plan. By driving the innovation
and improving the IT supply chain areas will also help the logistical areas to be developed from
which the company can generate the better results.
Plan for Action
Goal Activities Measure Time-frame
Improving logistics
process automation
 Accurate
pickup and
delivery timing
has been to
mentioned with
the location.
 Making the
delivery of the
products as
priority.
 A proper route
planning
should be
considered.
 Keeping the
goods together
if have similar
products to be
delivered.
 Optimizing the
usage of
The organization can
measure their efforts
of improving the
transportation
automation when
consumer can get their
products at accurate
location and within a
defined timeline.
It has been required to
adopt and enhance this
area about 3 months
by focusing entire
management.

resources
 Also, required
to reduce the
costs.
Increasing agility  For the better
improvement
and obtaining
the excellent
result the
organization is
required to
examine and
managing the
expectations in
such way to get
benefit.
 Keeping an eye
or focus on the
past sale data
which helps the
company to
make the
appropriate
decision-
making.
 Managing the
seasonal
changes an
instability in
manufacturing
of the goods
It can be measured
when a proper
management and
alertness has been
founded in the
company.
It requires 6 months to
keep focus on and
making the
improvement.

can operates
the finance or
budget where
warehousing
and
distribution
network can be
improved.
Ethical considerations
To run any business or an organization they are required to adopt and maintain the ethical
considerations so that they can be able to build reputed image and increased sales. Logistics and
supply chain management is the process which has to be done with fairness and honesty from
which the company can grow and develop (Petrović, Madić and et.al., 2018). Professional ethical
standards refers to promote the business with honesty and truthfulness where it includes all the
responsibilities like fairness with employee and staff along with customers. Another code of
ethic is to maintaining the accountability which includes the transparency, accuracy and
timeliness from which the consumer can trust the company and can create a business
relationship.
Recommendation
It has been recommended that the company is required to keep a focus on the customer
service areas from which they can be able to grow and develop their business accurately (dos
Reis Luz, and Parisi, 2018). The logistical process includes the transportation or distribution of
the goods and products which can be done according to the customer satisfaction and demands
which can result the company in excellent manner. Along with this, the company is also required
to maintain and concentrate on the different distribution strategies so that they can put the
effectiveness.
CONCLUSION
The report has concluded the meaning and brief about the decision-making in logistics
where it is the important part to be considered and keep an appropriate focus on. The report has
included the accurate structure where a right data analysis of the report has mentioned and

mentioned the appropriate problem of the ideology in logistics which organization faces. It has
mentioned the critical analysis of the problem and provided a solution by using a framework so
that the organization can be able to understand it in better manner. Along with this, a definite
amount of ideas has been mentioned from which the action plan has been performed for the
approach and supports the management in decision-making. At last, it has mentioned some
recommendation for the better results.