Supply Chain Logistics, Procurement, and Management: What They Are and How to Learn More

All aspects of the supply chain, including supply chain logistics, procurement, or simply warehousing products, play an integral role in the strength of your business. An optimized supply chain can lower costs, improve production, and increase overall revenue. It’s how today’s connected businesses gain a competitive edge to provide products or services with efficiency.

Deloitte surveyed more than 400 executives in manufacturing and retail businesses about supply chain capabilities. The data collected revealed that “79% of organizations with superior supply chain capabilities ("supply chain leaders") achieve revenue growth that is significantly above average.” Whereas only “8% of the organizations with lower performing supply chains ("supply chain followers") have above-average revenue growth.”

The survey defines a “supply chain leader” as those who:

  • Recognize the importance of innovation
  • Adopt disruptive technologies
  • Empower executive level leadership
  • Actively recruit talented supply chain professionals
  • Use analytics extensively

 

Would you define your business as a supply chain leader or follower? Are you doing everything you can to improve your supply chain management? In this post, we’ll discuss the differences between supply chain management, logistics, and procurement. We’ll also share a number of learning opportunities for extra insight or to begin a career in supply chain management.

 


 

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What’s the Difference Between Logistics and Supply Chain Management?

A supply chain is a network that links a company with its suppliers. It comprises all of the different activities, resources, staff, entities, and information required by an organization to deliver goods or services to consumers. When a supply chain is organized or managed poorly, costs go up, and the company loses its competitive edge.

Effective supply chain management optimizes the supply chain by enabling a faster production cycle and lowering overall costs, giving the company a significant advantage over competitors.

warehouse worker scanning

Logistics is a key activity within the supply chain, referring to the movement, storage, and flow of goods, services, and information both inside and outside of the organization, such as transportation, warehousing and inventory, or manufacturing.

Therefore, supply chain and logistics are not quite the same, but one won’t work effectively without the other. The focus of supply chain management is creating an optimized business model that links chief business processes across companies to establish and drive competitive advantage. Supply chain logistics refers to the nitty-gritty of manufacturing, storing, and transporting goods to meet the requirements of the customer while at the same time balancing supply and demand.

Effective logistics enables a company to deliver a product or service at the correct time and place with the correct quality and price. There are two kinds of supply chain logistics: inbound logistics and outbound logistics.

Inbound logistics refers to all of the activities required to obtain, handle, store, and transport materials. Outbound logistics refers to all of the activities required to collect, maintain, and distribute the product to the customer.

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What’s the Difference Between Procurement and Supply Chain Management?

Supply chain procurement is another key aspect of the supply chain that needs to be managed. Supply chain management refers to taking a holistic look at the entire supply chain, from the supplier all the way to delivering to the consumer, and evaluating the systems, people, and processes within that supply chain in order to maximize value in all areas.

Supply chain manager

Procurement in supply chain management refers to the process of procuring the goods and services the company needs in order to produce its offering and fulfill its basic requirements. This key process occurs at the front end of the supply chain and deals with things like purchase planning, negotiating price, finding suitable suppliers, defining quality standards, securing goods and services, controlling inventory, waste disposal, and more. The main goal of procurement is acquiring the best possible quality and quantity of goods and services at the best possible price in the least amount of time.

There are many moving parts in a supply chain, and procurement is one of the most important areas to optimize in order to manage the supply chain effectively. So, procurement is a key aspect of supply chain management, but only a piece of it.

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Other Aspects of the Supply Chain

Logistics and procurement are only two parts of supply chain management. The supply chain covers a long list of intricate moving pieces that help ensure a business is able to meet customer needs smoothly.

employee operating forklift

Supply chain management also includes warehousing, managing cash flow, information management, transportation, product development, manufacturing, return of goods, customer demand, forecasting, sourcing, inventory management, analysis, and more.

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Supply Chain Outsourcing

Some businesses outsource all or some aspects of supply chain management to professionals dedicated to supply chain knowledge and optimization. When the supply chain isn’t running optimally, it can cost businesses time and resources and hinder revenue growth.

warehouse men working

Hiring professionals to take care of these aspects of your business frees up your time so that you can manage, market, and grow your business. You can focus on the areas of the business you enjoy most instead of worrying about all of the many pieces at play in supply chain management.

Outsourcing can provide innovative solutions, advanced technologies, expert analysis, global business connections, reduced operational costs, risk mitigation, and peace of mind. At the same time, outsourcing is not the right fit for every business. Outsourcing can cause quality to suffer, your business values may not align with the companies you’re working with, and integration challenges can also arise.

💡 The Risks and Benefits of Outsourcing Supply Chain Management


 

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Supply Chain Logistics Certifications and Courses

Want to learn more about the various aspects of supply chain management? There are more online learning opportunities available than ever before. From free courses to multi-program certificates, you can learn more about the inner workings of supply chain management, including logistics, procurement, and everything in between.

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Association for Supply Chain Management Certifications

ASCM (Association for Supply Chain Management) is a global leader in supply chain certification. They offer globally recognized supply chain certifications and end-to-end training, ranging from beginner to mastery level.

 

Only the CSCP course (Certified Supply Chain Professional) requires a prerequisite bachelor’s degree. Each certification is achieved through a paid online exam. Exam prep and resources are available at an additional cost.

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MIT Supply Chain Fundamentals

MIT offers a free course (with paid upgrades available) on Supply Chain Fundamentals. The course runs for approximately 13 weeks with 8-12 hours of work per week. The fundamentals course teaches basic concepts for logistics and supply chain management, including:

  • Demand forecasting, planning, and management
  • Inventory planning, management, and control
  • Transportation planning, management, and execution

 
The course is part of the MITx MicroMasters Credential in Supply Chain Management, which comes with a cost and takes approximately 1.5 years to complete.

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Supply Chain Logistics Course

An introductory Supply Chain Logistics course is available online through Coursera. The 8-hour course digs into transportation, warehousing, and inventory, providing a start point for learning about logistics. A background in logistics is not required, but it is beneficial if you have a basic understanding of business concepts.

You can enroll for free starting at various dates throughout the year. This is course number one of five in the Supply Chain Management Specialization, which takes approximately 6 months to complete at 3 hours per week.

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Supply Chain Excellence 3-Course Program

For an advanced look at the supply chain and how products, information, and finances flow to and from businesses, Rutgers University offers a MasterTrack Certificate in Supply Chain Excellence. Over four months, students of the program learn how to manage product flow, information, technology, and finances to lead supply chain management operations.

The course requires 6-8 hours of online study per week for four months to earn the Supply Chain Excellence MasterTrack Certificate. An undergraduate education or professional experience, skills, or knowledge related to supply chain management is needed for success in the program. Payment is required to enroll in the course.


 

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ABOUT THE AUTHOR

Jordan's passion for travel led her to design a career as a remote content marketer. Nearing 1000 published articles, she's spent the past decade using her interdisciplinary education to research and write content for a wide variety of industries. Working remotely, Jordan spends half of the year exploring different corners of the world. At home, she's content exploring fictional lands—Spark an immediate and detailed conversation by mentioning Game of Thrones, Red Rising, Star Wars, or Lord of the Rings.

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