Operations and Logistics

The field of operations and logistics focuses on making sure that the right amount and quality of materials and goods are produced and delivered to the correct recipients according to schedule. The work involves production and service operations, with operations and logistics workers responsible for managing the supply chain, from purchasing raw materials to the production cycle to end delivery. In business operations, operations and logistics managers implement and manage systems for “efficient deployment of personnel, physical facilities, in-process inventories, finished goods, and related information or services,” as defined by the Business Department of the University of Missouri—Saint Louis.

Operations is also known as supply chain management. The Council of Supply Chain Management Professionals defines supply chain management as the planning and management of all activities for sourcing and procurement, conversion, and logistics management activities. This type of work also entails coordinating and collaborating with suppliers, intermediaries, third-party service providers, and customers. In addition to manufacturing operations, supply chain management coordinates the business processes and activities across marketing, sales, product design, finance, and information technology. Logistics management covers inbound and outbound transportation management, fleet management, warehousing, materials handling, order fulfillment, logistics network design, inventory management, supply/demand planning, and management of third-party logistics service providers.

The field of operations and logistics has roots that date back thousands of years. Sumerian priests created an early system of record-keeping for inventories of goods and business transactions. Egyptians devised plans for the organization and management of large projects entailing complex logistics, such as pyramid construction. The industrial revolution brought mass production and new divisions of labor. Companies needed ways to economically manufacture and distribute products, which gave rise to more study and analysis of production planning and inventory control.

Many different types of companies require the help of operations and logistics professionals to deliver and distribute their products as efficiently and cost-effectively as possible. There are no statistics that pertain specifically to operations and logistics as an overall industry, but statistics for sectors that include operations and logistics work give an idea of its role in commerce. For instance, the market research group IBISWorld cites that the freight packing and logistics industry generates $2 billion in revenue in the United States. There are nearly 6,500 freight packing and logistics businesses with roughly 31,000 employees.

Operations and logistics professionals work in manufacturing, federal government, companies and enterprises, wholesale trade, and professional, scientific, and technical services. Some companies have logistical departments, where logisticians and logistics managers work. Freight-shipping companies also employ operations and logistics managers. Operations and logistics workers are needed for scheduling and overseeing trucking, tracking inventory, mapping out the delivery of merchandise, and storing and handling products and materials.

The key jobs in the operations and logistics field include logistics managers and logisticians; transportation, storage, and facilities managers; retail and wholesale buyers, and entry-level jobs such as shipping and packing clerks and stock and freight clerks. In May 2015, there were 133,770 logisticians employed in the United States, according to the Department of Labor. Logisticians earn the highest salaries in the following areas: oil and gas extraction; highway, street, and bridge construction; other specialty trade contractors; petroleum and petroleum products merchant wholesalers; and business, professional, labor, political, and similar organizations.

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