Ph.D. in Economics Velichko O.P.

Dnipropetrovsk State Agrarian University, Ukraine

Main manifestations of contemporary logistics in the economical field

Very many contemporary scientists believe that the main potential of logistics in the economical field is in the rationalization of managing product flows. However, in domestic and foreign economical literature a wider interpretation of term “logistics” in which the object of managing (research) goes beyond product flows can be found.

Thus, the difference in definitions of essence of “enterprising logistics” as a scientific subject mainly forms by the place of the scientific subject and the object of research in the system.

In most publications business-logistics is considered either as a branch of knowledge in economics or as a component of management or marketing. The main object of research (management) in enterprising logistics is mainly determined as a product flow though many experts also define serving (providing) processes and infrastructure connected with them as the main object.

Obviously those scientists who consider enterprising logistics as a branch of knowledge in economics and the object of research as serving (providing) processes and infrastructure are closer to the truth.

Also the main reason of broadening in logistics application beyond boundaries of managing product and other flows, especially in economical environment is that economical logistics (business-logistics) is developing simultaneously in two directions nowadays: rationalization and provision.

Herewith in different cases their approaches or manifestations are accordingly used or considered integrated.

Rationalistic logistics is a logistics which studies models and methods of formalization and rationalization of certain economical phenomena with the purpose of optimal construction of flow processes and systems.

Rationalistic logistics is oriented towards support of solutions in the system of management. It is a certain development of logic as a science of properties and methods of thinking and a part of the military logistics (rational organization of relocation and provision of troops).

Supporting logistics is logistics which studies processes of business provision and different logistics formations connected with them.

That is supporting logistics is connected with formation and functioning of logistics objects, organizations, channels, chains, networks and logistics operations (processes) which create necessary conditions for carrying out a main line of business in a company. It is a certain developing of the military logistics (home front provision).

One of clear examples of the integrated manifestation in rationalistic and provision logistics is a logistics mixture.

More or less rationalistic and providing character of logistics is present in many definitions of this term.

For example a Polish expert E. Dworecki states that logistics is a branch of knowledge (in theory and practice) about managing chains of provision in processes of creation, relocation and use of the material potential and service provision, it also deals with study and interpretation of any phenomena, development of methods and tools which support optimization of supply chains as well as principles of their rational practical application [1].

We consider that rationalistic and supporting essence of enterprising logistics is best interpreted in the definition represented in “Standards on Logistics and Supply Chain Management” by the European Logistics Association. In it logistics is defined as planning, execution and control of movement and location of people and (or) goods as well as the provision action connected with such a movement and location within economical system created for achieving specific purposes. [2].

In this definition the object of research is not limited by exclusively product flows for not only flow but also location of people and goods is considered. Planning function implies rationalistic and providing actions – providing nature of such a phenomenon as logistics. Along with that instead of execution it is more reasonable to use one more important function of management such as organization.

Consequently enterprising logistics is a branch of knowledge in economics which studies processes of planning, organization and control of flow and location of people and (or) goods based on rationality and effectiveness as wells as supporting actions connected with such flow and location within and outside the economical system.

Thus logistics in economical field is not a component of management (marketing) but it is interpreted as the role of approach to management or its object (unlike logistics management or marketing).

Also contemporary objects of research in logistics go beyond product and other flows. The main reason of the latter is that enterprising logistics simultaneously develops in two directions: rationalization and provision.

Rationalistic and supporting logistics are basic in classification of economical logistics as its two main manifestations and they accordingly form its two basic types. In future it is worth studying these types of logistics more thoroughly.

Reference:

1. Dworecki E., j. Berny, zarzdzanie procecami logistycznymi (wybrane zagadnienia), wyd. Reprograf, radom 2005, s. 33

2. Standards of Logistics and Supply Chain Management / European Logistics Association. – 2004. – 15 s.