Understanding the Difference Between Logistics and Supply Chain Management

12 November 2024, 11:34 am IST

Logistics and Supply Chain Management are two related fields that are often perceived as interchangeable terms. However, Supply Chain Management is a broader term that focuses on managing the entire supply chain of a business from procuring raw materials to creating the final products/goods. It deals with the management and coordination of supply chains in a business.  On the other hand, Logistics is a part of Supply Chain Management and deals with the maintenance and integration of goods in an organization.   

In this post, let us consider the differences between logistics and supply chain management to help you understand the terms and make an informed decision in pursuing a career in these fields.

Difference between logistics and supply chain management

What is Supply Chain Management?

The Supply Chain is one of the principal activities of every organization which deals with the transfer and delivery of products and services in an organization.  Supply Chain Management is a process that manages the complete supply chain of an organization starting from procuring raw materials to delivering the final goods/products. The process aims to implement efficient and economic chains in organizations to control, transfer, and deliver products efficiently by cutting down excess costs and accelerating delivery.  Supply Chain Management streamlines the process of the supply chain with the help of technology.         

What is Logistics Management?

Logistics Management, on the other hand, is a part of supply chain management that highlights the efficient flow, movement, and storage of goods. This efficiency in movement of products to the desired location is done by Logistics experts by coordinating with other resources and partners. Experts in Logistics are responsible for controlling the movement of goods. They do it by tracking shipments, managing fleets, and coordinating with other resources.  Along with movement, goods storage is also important after they reach the destination. Hence, logistics involve a lot of activities within the supply chain and play an important part in the supply chain management.          

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Difference Between Logistics and Supply Chain Management

Here are some key differences between supply chain management and logistics management:

Supply Chain Management 

Logistics Management

It includes the complete supply chain starting from procuring raw materials to delivering products

It is a part of supply chain management and focuses on the flow and storage of goods efficiently

Production, sales, distribution, and customer service are a part of supply chain management

Transportation and storage are a part of the logistics

Optimizes supply chain for cost-effective and quick delivery of goods

Works on effective transfer and storage to meet the needs of customers 

Coordinates with partners of supply chain

Enhances storage and movement 

Integrates contemporary technology for optimization 

Uses the latest technology for tracking goods 

Evaluate performance as per the efficiency of supply chain and customer satisfaction

Evaluate performance as per logistics-related costs

 Benefits of Supply Chain Management vs. Logistics Management

Supply Chain Management: Benefits

·        Quality and Efficiency Enhancement: By implementing a standard for maintaining a certain quality, supply chain managers can help adhere to the process guidelines of companies and comply with their process requirements. Supply Chain also helps detect manufacturing delays and implement back-up plans to save time. 

·        Cost Reduction: Supply Chain Management also deals with minimizing shipping costs by identifying cost-effective and quick shipping methods. It also helps in reducing overhead costs by presenting automated solutions for improved productivity by implementing improved inventory. 

·        Better Access to Supply Chain: This is a process that takes into account all the aspects of a company starting from the production level to the sales and delivery level. It allows managers to access data more efficiently to have better access to the entire supply chain.

 Logistics Management: Benefits

·        Offers Transparency: With Logistics Management, organizations can expect to improve transparency in their business by creating and implementing strategies on Logistics Management. Logistics Management experts can study and analyze past data to understand and create optimization routes to enhance business efficiency. 

·        Improves Customer Expectations: A boost in Logistics management augments the transfer of goods during transport by removing obstacles to prevent delays in deliveries and enhance customer experience. 

·        Boosts Business Profits: The visibility gained by organizations through Logistics Management makes better customer relations and lowers excess inventory management requirements, which profits the company.    

Career Prospects in Logistics and Supply Chain Management

An MBA or any other degree in Logistics and Supply Chain Management can help candidates avail of some incredible and promising job roles such as:An MBA or any other degree in Logistics and Supply Chain Management can help candidates avail of some incredible and promising job roles such as:

·        Logistics Analyst

·        Fleet Manager

·        Logistics Manager

·        Warehouse Operations Manager

·        Supply Chain Analyst

·        Storage and Distribution Manager

·        Supply Chain Manager

·        Global Logistics Manager

·        Facilities Manager

·        Procurement Manager

All the above and many more rewarding job roles await deserving candidates after they complete an MBA in Logistics or Supply Chain Management or any other relevant certifications in this field.   

Conclusion

Looking at the growing requirement for logistics and supply chain managers globally to manage complex trends in the supply chain and logistics, these roles are deemed essential to allow a competitive advantage in businesses. Hence, pursuing courses in supply chain management and logistics offers an advantage for students to have a rewarding career in this field.     

If you are someone looking for online courses in Supply Chain Management and Logistics, Amity University Online brings you several lucrative and rewarding online MBA degrees and certifications in Logistics and Supply Chain Management, and related fields for a fulfilling career. Visit the Amity Online Portal to learn all about these and many other online programs for students and working professionals willing to pursue online education from the comfort of their homes. Amity University Online also offers excellent placements, international faculty, Industry-aligned curriculum, and many other benefits to online students.  

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Frequently Asked Questions

What is the difference between logistics and supply chain management?

Supply chain management is a broader term that focuses on managing the entire supply chain from procuring raw materials to creating the final products/goods. Logistics management, on the other hand, is a part of Supply chain management and deals with the integration and movement of goods, which concerns the flow and storage of products of logistics companies.

Is logistics part of supply chain management?

Yes, logistics is a part of supply chain management that emphasizes the internal movement of products.

How does supply chain management benefit a company?

Supply chain management improves the output or performance time of a company and helps products reach customers quickly.

Can a company have logistics without supply chain management?

Being a part of supply chain management, a company cannot have logistics without supply chain management.

Why is supply chain management more strategic than logistics?

Supply chain management is a more strategic tool because it helps companies create value for customers and investors by ensuring efficiency, improving quality, and optimizing logistics

Which is more critical to a business, logistics or supply chain management?

Both supply chain and logistics play a critical role in the success of a business. The combination of these two strategies helps a business have a competitive edge in the market and respond quickly and effectively to the changing demands of customers and the market.

What role does technology play in logistics and supply chain management?

Technology plays an important role in logistics and supply chain management as it enables decision-makers to make well-informed decisions as per updated information and help them identify problems early on to resolve them.