Consulting in logistics: the organization of business

The concept of “consulting in logistics” is everywhere. However, one cannot say that there are very many specialists in this field. For the most part, they work in large companies in cities with a population of millions, often leaving to provide services in other cities and abroad.

Practice shows that almost every entrepreneur will put its own meaning into this concept and develop its own criteria for assessing quality. And, of course, not everyone can immediately give a clear definition of what consulting in logistics is, what it consists of, what functions are performed by specialists. Yes, it is possible to operate only with general notions that the task of consulting is to optimize companies, reduce costs and improve the quality of customer service.

There are institutions of higher education, training specialists who will work in logistics consulting, and the training is quite complex. Today, however, actively adopting foreign experience, including the adaptation of teaching methods, programs, allowing the training of professionals really high class. There are also various schools of logistics, which allow you to be trained as quickly as possible, on a compressed program, but to get a sufficient amount of knowledge. As a rule, it is relevant to those who have already dealt with this area of activity and have a certain amount of practical experience.

 

Why financial consulting services are relevant

 

Consulting” is a relatively new word of foreign origin, which has taken root in many languages of the world. Speaking about what are the services of financial consulting, it is worth to lean on the international, first of all on the American experience. It was on the North American continent that this sphere of business originated, which was actively promoted by a developed infrastructure. Other features:

 

  • There are numerous consulting centers directly attached to institutions of higher education. This is a worldwide practice.
  • Specialists hold seminars, lectures, organize master-classes, and sort out certain highly specialized aspects of activity.
  • Sometimes specific cases, i.e. “cases”, as well as typical mistakes, complications which often make companies bear unplanned expenses are analyzed.

 

Financial consulting services are also of purely applied nature. Professionals study activities of an organization or enterprise, identify causes of expenditures. They also make practically applicable recommendations about optimization.

Some entrepreneurs are interested in financial consulting services in logistics or other areas on a permanent basis. Other clients invite professionals on an as-needed basis or when business owners cannot find the reasons for increasing costs on their own. The help of a professional will also help in those cases where it is necessary to analyze the correctness of the organization of document circulation, which will subsequently help in the filing of reports to the tax authorities.

 

What a financial consultant should be

Unfortunately, an objective analysis of the market shows that presence of prestigious higher education is not a guarantee of high quality services. Important criteria, which should be corresponded to a good financial advisor, can be demonstrated with the help of the following table:

Specialists working in special centers at institutions of higher educationFocused not only on practice, but also on theory, i.e., more fundamental knowledge
Specialists working in independent consulting centersOriented to solving specific cases and problems from the practical point of view

As a rule, a financial consultant working for specialized companies involved in foreign economic activity is a person with extensive practical experience. Such people are involved when it is necessary to get the most practice, to consider specific cases. There are professionals who have quite a narrow specialization, for example, analyze financial indicators of the transport forwarding system, evaluate cooperation of companies with customs authorities.

When engaging a financial consultant, one should formulate tasks and goals clearly. Then there will be fewer disappointments. If the aims are formulated as correctly as possible, the logistics company will offer a specialist in this or that field, including a very narrowly specialized one.

 

The solution of local and global problems

Conventionally, the needs of the company can be divided into two types: the need to get help in solving local problems or larger. Some clients are interested in targeted consulting or seminars for all employees of the organization, where the financial consultant will explain in detail about a particular aspect. There are also other nuances to consider:

 

  • Inviting a financial consultant for seminars, you need to clearly understand the goals, objectives, familiarize yourself with the program in advance.
  • Sometimes clients are interested in broader questions, i.e. to get acquainted with methodology, to broaden their knowledge base.
  • Some companies that offer financial consulting services openly say that it is not profitable for them to present extensive knowledge, methodology at away seminars, because then they can lose customers who, after training, can solve some logistical problems on their own.

 

Today, consulting in logistics is a very popular service. And the demand for it is growing. And this situation is observed in many countries around the world.

 

Who else provides financial consulting services

There is another category of companies that offer these services. These are the organizations that promote some products on the market. These firms are represented in the following areas:

 

  • Construction of warehouses, design.
  • Implementation of equipment designed to ensure the functioning of the warehouse.
  • Development of projects, software for promotion.

 

However, there are cases where financial consulting services are just a marketing strategy. The ultimate goal of the firm offering them is to sell their expensive methods, which are not efficient enough. Sometimes customers are offered software that is presented as a “panacea for all ills”. Accordingly, it costs a lot. The emphasis is on persuasion, on inducing the client to act. One must be very careful, since these firms have numerous licenses, certificates confirming their “professional suitability”, but such certificates are no guarantee of a truly high-quality approach to business.

We cannot say that all companies fit this description, but there is a certain segment of unscrupulous performers in any market offering similar services.

 

Can we talk about conflicts of interest when inviting a financial consultant

 

Yes, sometimes we have to deal with conflict of interest. Some specialists who offer consulting services in logistics, focus on the fact that they are guided by the latest developments, achievements of science and technology. If you look at the format of the report of the consultant, it is more like an abstract, where the theory and general concepts are much more than practically applicable strategies. In addition:

 

  • The strategies, tactics, and software offered are not always tailored to this particular business.
  • There should be specific calculations, stages and time of implementation of each stage. The more specific, the better.
  • The output should be a working control system that allows you to optimize costs.
  • It often happens that the customers themselves who invite financial consultants do not quite understand what they want to get in the end and form their requirements.

 

How to organize consulting in logistics and not to make a mistake

Logistics is a coordinating system, which involves the advanced methodologies, including those from other areas of business management. The table below will help you evaluate the results:

The result of the consultant’s workIt results in regulations of processes, flow charts, practicable and functional job descriptions for employees
Economic substantiationIt must deal with the costs of each aspect of the process chain

To really optimize costs, it is important to create a working system of regulations for each process, operations, indicating the time for their execution.

 

Information technologies

 

It is impossible to optimize costs if technologies are not involved. Modern consulting in logistics almost always implies the need for such transformations. If you manage technological processes in a manual format, there is a great risk of human factor: inevitable errors, deliberate or accidental inaccuracies, incorrect display of information, incomplete preparation of reports.

There is a proven software such as KIS, ERP, SCM, WMS. It is equally important to properly configure the algorithms of the software, taking into account the business and technological features of the enterprise. There is no universal, that is, a formal model of action, success depends largely on taking into account individual characteristics. In such cases, the functioning of the enterprise, the return of business processes will be transparent, allowing you to assess the amount of spending, investment and return on them.

 

Effective implementation of advanced technologies in logistics

 

When ordering a financial or other type of consulting services, you must be prepared for the implementation of recommendations in practice. If they are costly, implying radical changes in the functioning of the entire company or individual links (eg, warehouses), then such changes will be implemented gradually, in stages. Sometimes it is necessary to begin with the solution of other related problems, such as the restoration of primary accounting, checking document management, the creation of high-quality databases. They are the foundation of the enterprise.

Lack of information hinders the work of a financial consultant, because he will not be able to analyze the large amount of data for the current period and will have to rely on not too reliable information, which relate to past periods and are already considered outdated. That is why sometimes consultants have to do a really large amount of work, filling in the missing information from other sources. But in any case, the result of the activity will not be an “abstract” containing general information, but rather a truly working and practically applicable methodology. It will allow business owners to begin transforming their brainchild immediately. As you can see, consulting in logistics largely depends on how correctly selected the performer and how clearly he formulates a methodology, recommendations for optimizing the business.

No wonder many people compare the work of a consultant to that of a doctor. As we know, he works in accordance with the principle “Do no harm! This principle can and should be fully applied to logistics, financial consulting and related business areas.

The contractor is chosen on the basis of several criteria: reviews on independent resources, length of time on the market, reputation, rating. Sometimes people turn to the recommendations. Competition in the field of consultancy in logistics or other industries is very great, so there are quite a few companies which provide really high-quality services and have an impeccable reputation.

Людмила Логистик УКР

Эксперт в сфере транспорта и логистических процессов НАН Украины. Участница экспертной рады при министерстве транспорта и инфраструктуры