Logistics is now an important part of the supply chain for many businesses and seems a modern concept. However, its origins date back to Roman times and logistics has played a vital role in successful military strategy for centuries.
According to Wikipedia, logistics is defined as the movement of goods from their point of origin to the point of eventual consumption. This includes storage and transportation and controls the flow of the goods. The term logistics originates from the Greek word ‘logistiki’ which means accounting and financial organisation, as well as ‘reason’ and ‘rationality’.
Originally, logistics were used to ensure troops had sufficient supplies and equipment to maintain a successful military campaign. Since time immemorial, armies have depended on good supply lines to ensure that they are kept well-equipped and fed, as well as always having enough medical equipment. There is a constant logistical process of supplying these goods, which has been necessary since the idea of an army was first conceived.
In ancient Greek and Roman empires, the armies had officers with the title of ‘Logistikas’ whose purpose was to ensure that the supply of these goods was as smooth as possible. They knew that good logistics were vital to winning any campaigns and a poorly equipped army was going to be demoralised and lacking in basic equipment. As Napoleon Bonaparte famously stated, “an army marches on its stomach”. There have been several wars that are believed to have been won or lost purely on the basis of good or bad logistics management, including the American War of Independence, and many famous military leaders are thought to have been logistical masterminds.
Alexander the Great is one of the most well-known military leaders who led a massive number of successful military campaigns. In his short 13 years as King of Macedonia, he conquered Greece, India and Persia, among others and incorporated them into his growing kingdom. One of the problems he faced was that his 35,000-strong army could only carry ten days’ worth of supplies at a time, and most campaigns ran for much longer than this. To ensure the success of his army, he made logistics a central part of his military strategy, checking harvest calendars and the local terrain for good supply routes. He inspired many military leaders, including Caesar and Napoleon, replicating his success by following his reliance upon good logistical planning.
More recently, logistics is used to refer to the business function of the flow of business goods and products and some larger companies have an entire logistics department complete with extensive warehouse space. This can include the management of the flow of goods within the company (inbound logistics) and externally to clients and customers (outbound logistics). With the increasing demand for faster transportation and reliance on e-commerce, business logistics is becoming more and more important. A study in the United States recently found that logistics now accounts for a massive 10% of the overall gross domestic product. Most businesses understand, as Alexander the Great understood back in 376 BC, that well-planned and smooth logistics are a vital part of their success.
In the infographic below, you have a more detailed view over the history of logistics and SCM.