It might be easier to come up with a basic similarity than a basic difference.
 
If you think in terms of an outline, the whole outline is the whole system. A subsystem is one of the major outline topics. Within that are sub-topics that are jobs. And within each job are smaller sub-topics, activation groups.
 
A subsystem is a work management container for setting characteristics of the execution environment for jobs that run in it. It relates to a collection of jobs.
 
An activation group is a sub-unit of a single job. Resources that are accessed by the job can be isolated within an activation group. An activation group name is an attribute of a program.
 
Multiple programs can be called in a job, and programs that have the same activation group name will run in a smaller container together. They can share certain resources that aren’t available to programs in a different activation group.
 
Resources within the group are released when the activation group ends.
 
Tom

Tom, that has to be one of the most elegant and concise explanations of iSeries work management I’ve come across.

Thanks a lot Tom. You explained it very clearly.Sruthi

The problem with the description is that it’s too simple. It only gives a way to think about the structure of a relationship between the two. It doesn’t take much work to see that a lot is left out. — Tom