Logistics, Supply Chain Management and Integrated Logistics Support

People has been confused for the terms logistics, supply chain management and
integrated logistics support. These three terms has become a confusion among the public
when comes to definition and its roles. The terms has become essential among logistics
researchers, managers and educators. As the size, cost and strategic importance of
energy projects is increasing, it is essential to have a structured approach to planning,
design, construction and operation. The logistics, supply chain management and
integrated logistics support will ensure the human life-style will receive effective and
economical support and also meet its requirement.
According to Council of Supply Chain Management Professional (CSCMP),
Logistics is “The process of planning, implementing, and controlling procedures for the
efficient and effective transportation and storage of goods including services, and related
information from the point of origin to the point of consumption for the purpose of
conforming to customer requirements. This definition includes inbound, outbound,
internal, and external movements”, while according to Business Encyclopedia “Logistics
is used more broadly to refer to the process of coordinating and moving resources such
as people, materials, inventory, and equipment from one location to storage at the desired
destination. The term logistics originated in the military, referring to the movement of
equipment and supplies to troops in the field.” The objective behind logistics is to make
sure the customer receives the desired product at the right time and place with the right
quality and price. This process can be divided into two subcategories either inbound
logistics which covers the activities concerned with obtaining materials and then handling,
storing and transporting them and outbound logistics which covers the activities
concerned with the collection, maintenance and distribution to the customer.
Based on the above definitions, logistics could be simply defined as a process to
transmit resources from one location to other location. Transmitting process will involve
transportation and storage if necessary such as motorcycle, car, lorry, train, ship, airplane
and others. Resources means any tangible objects such as people, materials, food,
equipment, weapon, ammunition and others. Although it seems simple activities, but it
requires thorough coordination in terms of handling the shipment in order to ensure it

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arrives safely at the designated time. For example if we buy items from Lazada website
whereby the items is from China, automatically Lazada will inform that the items will be
delivered in 7 days. Thus, logistics plays important roles to ensure that items arrive on
time by using all transportation means through well coordination and planning.
According to CSCMP "Supply Chain Management encompasses the planning and
management 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, third-party
service providers, and customers. In essence, supply chain management integrates
supply and demand management within and across companies” while according to Luo,
Huang, Lee, & Pun, (2018), “SCM is a set of software solutions, internal business practice
and lighting managed partner relationship that allows serving customer more efficiently
by organizing and coordination in better way.”
Basically, Supply Chain Management is an integrating function with primary
responsibility for linking major business functions and business processes within and
across companies into a cohesive and high-performing business model. It involves the
logistics management, manufacturing operations, and it drives coordination of processes
and activities with and across marketing, sales, product design, finance and information
technology. SCM is created to gather firms cooperating in order to create customer value
as well as meets customer demand efficiently. For example, one of the Malaysian
Defence company is required to deliver a number of Armoured Vehicle 8x8 (AV8x8) to
Malaysian Army within time agreed and based on customer needs. The process of
delivering the AV8x8 will involve numerous parties and coordination from souring,
procurement and integration, manufacturer, warehouses, distribution as well as spare and
servicing. The success of SCM is definitely rely on the effectiveness of all parties related
to deliver AV8x8. If one of the element compromise, it will effects the whole SCM process
which later on effecting cost and time taken to deliver to customer.
Integrated Logistics Support (ILS) is the management and technical process
through which supportability and logistic support considerations are integrated into the
design of a system or equipment and taken into account throughout its life cycle. It is the
process by which all elements of logistic support are planned, acquired, tested, and

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provided in a timely and cost-effective manner (U.S. Department of Defense, 2005,
Dictionary of Military and Associated Terms) while according to (Jones & V., 1987), ILS
is an integrated and iterative process for developing materiel and a support strategy that
optimizes functional support, leverages existing resources, and guides the system
engineering process to quantify and lower life cycle cost and decrease the logistics
footprint (demand for logistics), making the system easier to support. Although originally
developed for military purposes, it is also widely used in commercial product support or
customer service organizations.
Based on the above definitions, ILS could be simplified as a system to identify cost
related of each system required from scratch to development and operational processes
until obsolescence process (from cradle to grave). ILS is the set of all considerations
necessary to increase the effective and economical support of a system throughout its
programmed life cycle. ILS is a part of the larger SCM which is an integral part of all
aspects of design, development, system definition, installation and operation. In other
words, ILS is an iterative and integrated process that made the system easier to support
for developing and operationalize an asset. Integrated Logistics Support is focused on
developing the support solution to assure supportability and life cycle costs. Thus, the
products or logistics will meet the required performance by designing, developing,
acquiring and providing the support system that will maintain the operational readiness of
the logistics that would be supplied. ILS also will also reduce the faulty in the logistics
distributions which would sometimes excessed from the initial demands. Therefore, ILS
will assist the organization to ensure that the logistics in the supply chain will anticipate
the customer wants and needs without any error or fault. ILS also provides the assurance
that personnel have the correct skills/training, correct documentation, correct tools,
correct spare and correct facilities/resources to support a given system through its life
cycle. For example, although the system of AV 8x8 have its own ILS but it had faced so
many restrictions because of ILS has been compromised due to budget constraints.
Based on the explanation above with regard to the three elements, it can be
deduce that logistics is a part of SCM. I would define logistics as the storage and
movement of goods from origin point either supplier, manufacture, warehouses and
others through to the destination point such as customer, with a large emphasis on

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transportation while SCM coordinate all the movement of resources from origin point to
numerous parties involved in the cycle until it arrive to consumption point. Moreover
Logistics and SCM is about planning and controlling the activities of a company as well
as coordination between companies, in order to secure that the right product is delivered
in the right quantities, to the right customer, at the right time and to the right price. Thus,
logistics plays an important roles for SCM. Failure to do so will compromise other SCM
parties and will effect cost and time. It seems both elements, logistics and SCM need
each other’s. One process cannot exist without the other. Although both needs each
other’s, there are some key differences between both elements as per below:
1. Supply chain management is a way to link major business processes within
and across companies into a high-performance business model that drives
competitive advantage.
2. Logistics refers to the movement, storage, and flow of goods, services and
information inside and outside the organization.
3. The main focus of supply chain is a competitive advantage, while the main
focus of logistics is meeting customer requirements.
All the three elements will be implemented together when it involved strategic
procurement either in defence industry or commercial industry. In commercial industry,
all the elements are integrate to achieve value for money because of their platform based
on profit oriented while in defence industry, combination of the three elements are to
achieve value for defence because of their platform based on the capability to uphold the
national sovereignty. For example, in commercial industry, Malaysian Airlines System
(MAS) has procured aircraft Airbus A380 for its fleet in order to expand their services
while in defence industry, Malaysian Armed Forces has obtained aircraft A400M for Royal
Malaysian Airforce (RMAF) assets in order to expand RMAF capabilities to operate and
maintain the sovereignty of two theater simultaneously. If those three elements not take
into account during the procurement of strategic assets for both industries, it is not only
delay in term of delivering, but it could effect it operationalize and maintenance which on
top it will compromise vision and mission of the organization. On the other hand, ILS
would not be integrated together with logistics and SCM when it is only involve non-

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strategic resources such as consumable items for example foods, toiletries and others.

In conclusion, the public opinion regarding on SCM, Logistics and ILS must
acknowledge the difference between the three terms mentioned. This to avoid any
confusion from the usage of these terms when conducting the business negotiation and
administration. One must acknowledge the difference, characteristics, objective and how
these terms functioned. It must be noted that SCM is the main and broader subjects of
the current administration and management of supply throughout the organization. SCM
has substituted the logistics as delivering products when it has become more complex as
it entered 21th century due to extensive demands from various organization. The
introduction of ILS has been used as a platform to solve an overflowing and faulty
demands from an organization. ILS will ensure the consumer or organization only meets
the required products needed only without having any excessive products given to them.
This integrated system has helped to decrease the costs and increase the return on
investments. It must be noted that SCM, Logistics and ILS has one goal which is to
provide the goods, services and products to its consumer on time without failed. Over
times, human has evolved these supply management in order to meet the demands of
the consumers that need and want the product to be delivered to them. Public opinion
now will understand the differences, definition, objectives and characteristics between
these three terms in assisting the business management.
(1774 words)

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References:

Business Encyclopedia https://www.shopify.my/encyclopedia/logistics

Council of Supply Chain Management Profesionals

https://cscmp.org/CSCMP/Educate/SCM_Definitions_and_Glossary_of_Terms/CSCMP/
Educate/SCM_Definitions_and_Glossary_of_Terms.aspx?hkey=60879588-f65f-4ab5-
8c4b-6878815ef921‘

Integrated logistics support

https://www.mitre.org/publications/systems-engineering-guide/acquisition-
systems-engineering/integrated-logistics-support

James V. Jones, (2010). ILS Management Handbook. McGraw-Hill Education; 3 edition

(June 30, 2010).

Kain, R., & Verma, A. (2018). Logistics Management in Supply Chain - An Overview.
Materials Today: Proceedings, 5(2), 3811–3816.
https://doi.org/10.1016/j.matpr.2017.11.634

Logistics and supply chain management

https://www.michiganstateuniversityonline.com/resources/supply-
chain/is-logistics-the-same-as-supply-chain-management/

Luo, R., Huang, J., Lee, J., & Pun, P. (2018). A Case Study of Supply Chain
Management in a Manufacturing Company in China. Nang Yan Business Journal,
6(1), 1–20. https://doi.org/10.2478/nybj-2018-0001