network of scm

network of scm

Saturday, April 2, 2011

How do you differentiate Supply Chain Management with Logitics?


  • Logistics is, as Peter described, the movement of material between trading partners: Vendor to Company, Company to Customer. In other words, the transportation element. Supply Chain is managing all of the material movement related to the trading partners: Visibility to Vendor Inventory, Ordering from Vendor, Receipts from Vendors, Storage, Production/Sales Order Fulfillment, Loading, In-Transit Visibility, Visibility to Customer Inventory and Ordering from the Customer.


  • Logistics makes the core - methods and tools - process engineering and operational execution. It used to be treated as an internal or at last simple multi-tier process at first. Since importance of logistics and process thinking in general increased in value it gained strategic facet as well. Once that happened one couldn't operate only in constrained silo thinking, needed further perspective - business approach with all management wisdom deployed. Negotiations, business process management, continuous improvement, customer/supplier relations, externalities, social responsibility, etc., etc.. It all adds on to logistics making it supply chain. Hence in mind opinion SC is much bigger than logistics. It will remain so. I would dare to say that business management, as we know it now, will be superseded by SCM pretty soon.TO Me , SCM is more about the predictive nature of the business landscape and Logistic is the physical nature of the goods in motion.


  •  logistics as the time related positioning of resources(men+Facilities+fleet+Ships+Planes+Information) that a company has at it's disposal to manage it's Supply Chain.Supply Chain Management has got infinite possibilities. If A company or Group of companies has/ have enough resources and particularly deep pockets and an enviable reputation in the market , then they could potentially run the economy of a place, through their efforts to deliver: the right product ,is in  the right quantity ,in the right condition ,to the right place ,at the right time ,for the right cuer in complex chain of supplier/ customer relationships .


  •  "Logistics is the science or art (semantics?) that coordinates the activities involved such that a customer receives the right product in the right quantity at the right time" Thus "Logistics" applies as a subset of determined processes, methods and events used WITHIN the context of Supply Chain Management to accomplish SCM in any given situation. To that extent, there most likely will be a multiplicity of discrete "Logistics" plans within an overall Logistics plan within any particular SCM thread depending upon the overall level of complexity of the processes and sub-material parts involved in producing the deliverable result to the end-user/ customersupply chain - a series of producers joined together from raw materials to finished product in customers hands. Then, there is the need to manage that supply chain. This involves 5 distinct competency sets, namely: 
  • Production & Inventroy Control 
  • Strategic Procurement 
  • Transportation & Storage 
  • Information Systems 
  • Improvement 


  • logistics would be all tasks related to warehouses and transportation.Supply Chain is a wider concept that goes from the initial signal of demand (forecasting), supply planning, supply ordering, logistics and customer order management. SC is an end to end process or responsibilties


finallly in my  opinion we can say-
  • "Logistics is the management of the flow of goods and services between the point of origin and the point of consumption in order to meet the requirements of customers. Logistics involves the integration of information, transportation, inventory, warehousing, material handling, and packaging, and occasionally security. Logistics is a channel of the supply chain which adds the value of time and place utility" Supply chain deals with the unquantifiable elements, like which vendor will produce X amt in Y days... which Customer zone will want A amount of Goods.. Etc..

1 comment:

Dr.s.k.paswan said...

it will reallu helpfu........