Helping the Logistics Sector Create Value

29 Apr 2020

The CII Institute of Logistics, a CII Center of Excellence (CoE) in the logistics and supply chain management domain, uses a multi-pronged approach to help transform the logistics sector, and is working to enable the sector to add value to manufacturing, domestic trade and exports.

The Institute, which was started in 2004, with the objective of bringing more players into the organized segment, has succeeded in bringing service providers and users of logistics services on one platform to gain more insights into the emerging trends, and adopt global best practices.

While there is a need for the highly fragmented Indian logistics market to get more organised, there is also a need to reduce logistics cost from the about 14% at present to 10% by 2022.

Only 10-15% of the $215-billion Indian logistics market is owned by organized players. Also, the level of inefficiency in logistics activities is very high across all modes. This is where outsourcing is helping players realize significant cost reductions and other benefits.

“Outsourcing has to increase; it will help the industry utilize assets and infrastructure better in India,” said Mr R Dinesh, Chairman, CII Institute of Logistics Advisory Council, and Joint Managing Director, T V Sundram Iyengar & Sons Pvt Ltd.

The CII Institute of Logistics provide services in four key areas – education and training, advisory services, research and publication, and events.

Under education and training, more than 12,000 people from the industry have gained from various education programs, which have been developed in collaboration with sector-specific councils, universities and colleges. Also, to prepare industry-ready professionals, a CII School of Logistics was established in 2016.

“With this, we have certified many thousands of professionals in supply chain. Skilling is also being done across sub-sectors of the industry,” he said.

Through multiple training programs, both short-term and long-term, the Institute certifies 3,000 to 4,000 people – from mangers to vice presidents – every year.

Under its advisory services, the Institute rates warehouses using an in-house methodology named WAREX, which looks at infrastructure, processes, and people.  The second area of focus is the SCM (supply chain management) Maturity Model, which rates companies on their level of maturity.

To encourage organizations to upgrade themselves, the Institute presents SCALE awards. In the past six years, 1,000 companies have contested for these awards. Of these, 400 have been recognized/rewarded.

At the sectoral level, the CII Institute of Logistics has been working on improving the image of the industry, while implementing logistics standards.

“While people are aware of standards, there is no single code or standard in India (in logistics). CII is playing a proactive role and suggesting standards for the sector. This is expected to be announced in the upcoming logistics policy,” said Mr Dinesh, adding that the Institute’s contribution was significant in getting infrastructure status for the warehousing sector.

He said that a MoU has been signed with the Association for Overseas Technical Cooperation and Sustainable Partnerships (AOTS), Japan, to gain technical knowledge from them. “Japan is very strong in standards regarding logistics, and there is a culture of constant improvement in that country. We have gained a lot in manufacturing through Japanese quality movements. We expect similar benefits in logistics as well,” said Mr Dinesh.

This article by G Balachandar was first published in the Hindu BusinessLine on 11 March.

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