Supply ChainManagement VS logistics Management

Supply chain management (SCM) and logistics are two interconnected but distinct concepts that play crucial roles in the field of operations management.

SCM involves the coordination and management of all activities related to sourcing, procurement, conversion, and delivery of goods and services from suppliers to customers. This includes managing the entire network of organizations, resources, activities, and technologies involved in the flow of products or services from the point of origin to the point of consumption.

The goal of SCM is to optimize the overall supply chain to achieve efficiency, cost-effectiveness, and customer satisfaction by using strategic planning, coordination, and collaboration among various stakeholders.

The activities involved in supply chain management are:

• Integration
• Services
• Sourcing
• Logistics
• Testing
• Production
• Measurement?
• Performance etc

Supply Chain Management ensures the flow of raw materials and processes in progress within and outside the organization’s end product. It is also responsible for the order, inventory, and supply chain process.

Logistics management is a subset of SCM that focuses on the physical movement, storage, and flow of goods from the point of origin to the point of consumption. It primarily deals with the operational execution of activities such as transportation, warehousing, inventory management, packaging, and distribution. Logistics ensures that products are delivered to the right place, at the right time, in the right quantity, and in the right condition. It involves managing transportation routes, selecting carriers, optimizing inventory levels, and ensuring efficient handling and storage of goods.

The logistics management system’s main purpose is to plan and implement the movement and storage of goods effectively. It also controls how goods move from one place to another using modern technology.

Logistics companies offer customers diverse services using different assets, i.e., air, land, and ocean. The?logistics management system?has the following objectives for products delivery, i.e.:

• Right product
• Right quality
• Right time
• Right place?
• Right price?

In a logistics management system, there are many activities are involved. These activities are divided into two categories:

1.???Inbound Logistics

2.???Outbound logistics

• Inbound logistics comprises activities with procurement of material handling, storage, and transportation of goods from one place to another.
• Outbound logistics comprises activities related to the collection, maintenance, distribution, and delivery of goods to the end users.

Some points mentioned below can differentiate between supply chain management and logistics management.

• Supply chain management is about the coordination and management of the supply chains of a company. Logistics management is integrating and maintaining goods in a logistics company.
• Logistics management is meant for customer satisfaction, whereas supply chain management aims to get a competitive advantage.
• Logistics management includes only a single company or an organization, whereas supply chain management involves multiple organizations performing with coordination to complete the whole process.
• Logistics management aims to deliver goods to the destination, whereas modern techniques facilitate the customers.
• Logistics management is one of the oldest terms that work using traditional methods, whereas supply chain management is only an addition to logistics management.
• Supply chain management aims to connect suppliers to the ultimate consumers, whereas logistics management is about the maintenance and storage of products.
• Logistics is the sub-sector of supply chain management, whereas supply chain management is a new and trendy concept.

Both SCM and logistics are critical components of operations management and are essential for organizations to achieve their business objectives.

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