In this paper an introduction to the principles and methods used in logistics and supply chain management is presented. It begins by a discussion on fundamentals and explains the relevant terms. Next policy and practice associated with logistics and freight services are regarded with a focus on the EU policy for the sector which greatly influences the development of logistics chains and services. Mathematical formulation of typical transport and logistics-related problems is also presented followed by a discussion on the concept of sustainability.
The term “logistics” originates from the ancient Greek word “λóγoς” (logos—ratio, word, calculation, reason, speech, oration), and as such the word logistics has been in use for a much longer time than the current business logistics concept. The word logistics itself originates from the military discipline. There were divisions in the military who were responsible for the supply of necessary arms, ammunition and rations as and when they were needed, for example when they had to move from their own base to a forward position. In that situation the logistics division would provide all the necessary support to move the arms, ammunitions, tents, foods etc. In the ancient Greek, Roman and Byzantine empires, there were military officers with the title ‘Logistikas’ who were responsible for financial, supply and distribution matters. Not surprisingly the Oxford English dictionary defines logistics as; “The branch of military science having to do with procuring, maintaining and transporting material, personnel and facilities.” Another dictionary defines logistics as “The time related positioning of resources.” Logistics is also commonly seen as a branch of engineering which creates “people systems” rather than “machine systems”, but the modern logistics concept and practice is about providing cost and time effective services for non-military, mainly commercial activities. This service includes the transport of goods from one point to another, warehousing them in a suitable place, inventory, packaging, and other administrative activities such as order processing.
For measuring sustainability of transport modes and their impacts on environment and health several indicators have been selected, flexible enough to be adapted to technological innovation and society changes (greenhouse gas emissions, pollutant emissions, noise, congested traffic, car dependence, traffic volume, collisions, road kill, etc.). In particular, there has been defined an aggregate indicator, “eco-efficiency”, which is “the amount of natural resources used (including emissions) in physical terms in relation to the output of the activity, either in physical terms (e.g. tkm) or in value terms (e.g. Euros)” (Perrels, Himanen, & Lee-Gosselin, 2008).
Problems can arise when measuring the sustainability of future transport infrastructure as any appraisal of new investments in infrastructure is made over a long time period, with 30 years being typical for a new stretch of road and in the case of major project, as much as 50 years. As such, building transport infrastructure is a time intensive and relatively inflexible process.
Remaining at financial level, it is a common belief that public transport infrastructure projects involve many risks and uncertainties, partially explained by the long period of time taken in the design and the construction of project once the decision to proceed has been made. In a more comprehensive forward-looking approach, those uncertainties have relevant impacts on the infrastructure sustainability too. When a new technology able to mitigate some impacts becomes available, or new behaviours or lifestyles take root, or new global, national or local policies are set up, a transport infrastructure should have the capacity to adapt itself and provide the necessary support to minimise future negative transport externalities. Therefore, the introduction of radically more fuel-efficient propulsion technologies can reduce greenhouse gas emissions and break away from the overwhelming oil dependency only if infrastructure is ready to provide the necessary facilities and the society has progressed in social learning. For large infrastructure projects, the process of adjustment is possible only if already included in the project alternatives. This indicates the potential positives in a long-term development vision, in the pursuit of an effective, efficient and sustainable transport system
