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What is Supply Chain?

The expression “supply chain” was created during the 1980’s to explain the need to integrate important business processes.

Indeed, supply chain is about integration between business functions and business processes. It is about giving all the information which is important for any services in the industry and for partners of the company such as suppliers, retailers and so on…

In supply chain, there is a global and not a local optimisation.

The idea is to optimize the entire supply chain and not only results of the firm. A good supply chain involves a strong collaboration between actors of the supply chain. Therefore, there is a change of scale concerning competition; it is not a competition between firms but rather a rivalry between types of supply chains. Moreover, we have to show clearly the difference between logistics and supply chains because there is often confusion about these two words.

Logistic is a term which applies for the activity of a company. It involves just the distribution of the product whereas supply chain includes logistic, suppliers, manufacturers, retailers… “Supply chain” is a vast concept which has to be well understood in order to manage to have a good overview of potential problems and advantages of this sector.

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chiefstaff

  • Sanjeev says:

    Logistics Management is a small portion of Supply Chain Management that deals with management of goods in an efficient way. Although, if we talk about Supply Chain Management, it is a broader term which refers to the connection, right from the suppliers to the ultimate consumer. People are quite puzzled between these two concepts.

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