The strong men of logistics
June 14th, 2003

The viability of the logistics function in every organization depends, to a great extent, on talent, personality and their managers’ or directors’. In Colombia, a person is called strong (leader) referring to any man or woman that outstands in the economic, political, social, scientific, religious, sports or cultural field. ZONALOGÍSTICA undertook the task of describing the possible characteristics, knowledge and virtues that a logistics manager should have in these days. To achieve it we present in this edition various profiles and experiences of Latin American managers who face the goal to turn logistics into a source that creates value added for their companies. These are the strong men of logistics:

Integrated logistics services
Yobel group, integrated by the following companies, Productos Favel S.A. (cosmetics and personal care products manufacturing), Glacesa S.A. (fine costume jewelry production) and Larissa S.A. (logistics operator with over 35 years of experience), has economically excelled in Peru and in the South American market thanks to its constant efforts to improve the supply chain for its customers.

The Economist Francisco J. D’Angelo, Yobel group’s Managing Director, wanted to share with ZONALOGÍSTICA’s readers some topics of his experience as the head of this conglomerate.

To reduce costs and share information
“For us it is more important to define the key moments in all the supply chain and not only in the logistics section. If the key moments of a company are defined as those in which the customers can identify if the services are good or bad, then we can point out four important processes inside the chain.

–	Forecasting: Percentage of deviations that originate higher costs or create market shortages.
–	Sourcing: Time of delivery, adequate purchase lots, prices.
–	Manufacturing: Flexibility and minimum manufacturing lots.
–	Logistics: Inventory management, delivery times to customers and returns.

Yobel group uses different management ratios for each key moment and each customer. These ratios are then compared with those of a particular company. Besides that opportunities to create more value added for the users are constantly evaluated. “The concepts and theory about the chain are in full effect. Today, the need to reduce costs has turned into the number one priority in the agendas of general managers of successful companies, specially in a market in which it is more difficult to differentiate products due to great competition and a tendency to reduce prices that also reduces profit margins.”

The Director also thinks that the conceptual tools for the supply chain design and management should be held, to a great extent, within the technological solutions available in the market. It is also very important that all the members of the chain links (supplier, manufacturer, distributor, wholesaler and retailer) are really willing to share the information so that they can visualize the costs of the whole productive cycle and thus, be able to eliminate the activities that do not add value. Many companies are still reluctant to exchange information and this is what will guarantee a good cost throughout the supply chain. In other organizations the directors have still not recognized this activity’s benefits.

We live putting out fires
“To Yobel, a strong or optimal company in logistics is the one that provides an integral logistics service: inbound logistics (forwarding, bond release, reception), internal logistics, outbound logistics (picking, routing and orders delivery) and reverse logistics (exchanges, returns and cancellations)."

“In the Andean region we do not know many organizations that will offer these integrated services. In Peru there are only two or three companies. I do not know about such offers in Colombia. There are none in Ecuador and Bolivia. There are some North American companies specialized in freight forwarding that have begun to explore the market, but always as a request from their customers and not by their own initiative.”

Francisco J. D’Angelo considers that the logistics area is responsible for the costs and the time invested in the transportation of a company’s products from raw materials or finished products. He also indicates that these can have a better impact on inventory management and purchase planning to suppliers. “The most common characteristic of logistics managers is that we live putting out fires on a daily basis and that we have little time for the extremely important task of planning. I think this task is the most important that any person working in logistics should have. Extra working time is a Latin American reality that results from the lack of planning.”

Searching new ways of adding value
“We consider ourselves strong in supply chain management, because we do not only cover logistics but the whole integral process. Furthermore, we have over 20 years of experience, we reach over 140,000 destinations in Peru, we dispatch over 6,000 orders per day and our customers manage their operations through our website. The main characteristic that a logistics expert should have is to be aware of new ways to add value to their customers and all business procedures throughout the supply chain.”

D’Angelo recommends
“To achieve a 100% performance in logistics management four things are required":

ZONALOGISTICA MAGAZINE, Edition N. 14.