SCM & LOGISTICS: WHAT’S THE DIFFERENCE?
Do you consider Supply Chain Management and Logistics as the same?
Are they interconnected?
Well, it has been a question of a dilemma for a long time for many individuals. However, people Certified in Planning and Inventory Management (CPIM) or supply chain could clearly state the difference. So, let us understand the exact theory.
Understanding the meaning
Let’s start with considering the supply chain as a web of manufacturers, suppliers, wholesalers, retailers and buyers. Do not think of it as a chain of functions or activities.
Now, consider moving the goods from one place to another and name it logistics within a supply chain.
With this, we can figure out that logistics forms a part of the system of the supply chain. Here, the supply chain is an umbrella term that takes into account logistics alongside the internal and external supply chain activities.
To put it in another way, the supply chain is the broader term that involves the flow of goods/ services, information and capital right to the consumer. It is associated with procuring raw materials and consumer requirements, product conversion, and logistics.
There you go with logistics.
So, what is Logistics?
Logistics is the process of delivering goods to the consumers on time. It involves storage and transportation of the goods and comes under the process of the supply chain.
Over time, technological advancements and innovations have led the supply chain to grow and evolve over logistics as an improvement of logistics itself.
What separates Supply Chain Management and Logistics?
- Supply chain management is the management and coordination of goods right from procuring raw material till the final product is delivered.
Whereas Logistics involves the storage and flow of goods from the organization to the place of consumption.
- Supply chain management focuses on gaining a competitive advantage for the business over others.
But Logistics emphasizes customer satisfaction over anything else.
- Supply chain management is an evolved and refined concept of logistics developed over time due to technological innovations and advancements.
Logistics management was earlier used as the way of delivery of goods and services to the final consumers.
- Supply chain management is concerned with multiple organizations owing to the processes such as suppliers, intermediaries, wholesalers, retailers and consumers.
However, Logistics management deals with only one organization for the storage and flow of goods of the same.
- Though Supply chain management is the broader, new and modern concept.
Logistics, the traditional method, forms a part of the supply chain now.
- Supply chain management involves a series of activities that are interconnected from the starting till the end. i.e from sourcing raw materials to delivering the goods to the final consumers.
Logistics management involves activities such as warehousing, packaging, order fulfillment, stock control and management.
The increasing need for a complex supply chain across the globe demands expertise and skills on the part of professionals. Getting a specialization in supply chain management would enable individuals to understand production, logistics and other processes involved in the business.
An elite partner of APICS and affiliate of Demand Driven Institute, KnoWerX offers the finest distance learning professional and APICS Certification programs. Along with these, it offers other training programs and courses.
The certifications and courses offered are in the area of supply chain management, operations management, production management, material management, demand planning, distribution management, logistics management, theory of constraints and transportation management.
The certifications and endorsements you can get from KnoWerX includes Certified in Planning and Inventory Management (CPIM), Certified Supply Chain Professional (CSCP), Certified in Logistics, Transportation and Distribution (CLTD) and Supply Chain Operations Reference Professional (SCOR-P).
Individuals can get plenty of benefits from it such as higher recognition, personal development, accelerated career growth, higher success rate, better salary and much more from the supply chain management courses.
SCM Talk Show-Supply Chain Risk Management, Episode 3.
Watch our latest episode of SCM Talk Show on the KnoWerX YouTube channel & Subscribe for more updates.
SCM Talk Show, Episode-8
Download KnoWerX App and follow KnoWerX Education on LinkedIn, Facebook, Twitter and Instagram for regular updates in the field of Supply Chain Management.