Traditional Definition of Logistics and Supply Chain

Logistics VS Supply Chain

Logistics Management:

As adopted by the Council of Supply Chain Management Professionals (CSCMP).

The part of supply chain management that plans, implement, and control the efficient, effective, forward and reverse flow and storage of goods, services and related information between the point of origin and the point of consumption to meet the customer requirements.

Logistics has always been about managing the synchronization of the needs of individual companies for product, service acquisition with the resources available from suppliers, on the one side, and distribution functions to meet the demands of the customer, on the other.

  • The key concepts inherent are those of movement or “GO” and Storage or “STOP”.
    • Go: The goods being moved or transported to the customers or back in a reverse. This is a time concept
    • Stop: The storage of goods for processing and other operations or to wait for further movement to customers at later time. This is a place or location concept
  • The other key concept is the objective or meeting customer’s requirements “Go or Stop”.

 

Once a firm actively engaged with its Suppliers, Customers and other stakeholders, its logistics activities go beyond its own door into the wider Supply Chain.

 

Supply Chain Management:

If you sell a product with parts purchased from supplier or if it’s purchased complete from supplier, then you have a supply chain

As adopted by the Council of Supply Chain Management Professionals (CSCMP).

The management and planning of all activities involved in sourcing and procurement, conversion and all logistics management activities. Importantly, it also includes coordination and collaboration with channel partners which can be Suppliers, Intermediaries, 3PL service providers, and Customers.

As adopted by Sunnil Chopra and Peter Meindl in their book “Supply Chain Management”:

A supply chain consists of all parties involved directly or indirectly in fulfilling a customer request, it includes Suppliers, Manufacturers, Transporters, Warehouses, Retailers, and Customers.

In essence, supply chain management integrates supply and demand management within and across companies.