The Chicken and egg story in Logistics

What come first - setting up a good logistics network and then starting the business or starting the business and then setting up a logistics network to support the requirements that crop up? A lay man answer would be to say 'business' comes first. But sometimes the cost of such rear guard action may be prohibitive and in fact cause the business to shut shop.

The US government committed additional combat troops to Afghanistan. As per a report in today's Wall Street journal, the supplies necessary for this deployment are just not here. The building material (concrete blocks - to be procured from Pakistan), fuel (Afghanistan is land locked) and blast resistant trucks ( to be imported from US) have all to reach Afghanistan before the troops actually arrive.

I am not questioning if the troops should be sent or not. Obama already has a Nobel prize for peace so I will keep my personal views away from this. The issue is of planning the logistics and sequencing the deployment of troops in sync with logistics deployment. We certainly not want troops to be in war zone without the necessary equipment and logistics support.

It is easy to take a 'consultant' position and advice the armed forces. In our businesses however the logistics side of business is totally ignored. The modern trade in India has set up retail shops and are now, at a much later stage, thinking of logistics optimisation. New products are being designed without too much thinking of the increase in component SKUs and thee corresponding affect on inventory related costs.

It is a simple proposition that I am trying to put forward - Business requirements have to be met. There is no question of this. This, however can not be done at the cost of ignoring the constraints of logistics. For every step of business growth and change, the corresponding logistics resources should be planned also. And, this logistics planning must be done in the same forum that does the business planning and not by a department head.