Strategy.Corporate Strategy.Product Development Strategy.Supply Chain or Operations Strategy
Strategy Information Technology Strategy Finance Strategy Human Resources Strategy
Corporate and Functional Strategies Corporate Competitive Strategy Product Supply Chain Marketing Development or Operations and Sales Strategy Strategy Strategy Information Technology Strategy Finance Strategy Human Resources Strategy
the Corporate Strategy Responsiveness (Reliability; Quickness; Flexibility; e.g., Dell, Overnight Delivery Services) Competitive Advantage through which the company market share is attracted Cost Leadership (Price; e.g., Wal-Mart, Southwest Airlines, Generic Drugs) Differentiation (Quality; Uniqueness; e.g., Luxury cars, Fashion Industry, Brand Name Drugs)
Strategy and Issues during aProduct’s Life CYCLE Introduction Growth Maturity Decline • Best period to •Practical to •Poor time to •Cost control increase market change price or change image, price critical share or quality quality image •R&D engineering •Strengthen •Competitive costs critical niche become critical •Defend market Sales position Time• Frequent product •Forecasting •Standardization - •Little productand process critical minor product differentiationchanges •Products and changes •Overcapacity in•Short production process reliability •Optimum capacity the industryruns •Increase capacity •Process stability •Reduce capacity•High production •Shift towards •Long production and eventuallycosts product focus runs prune line to•Limited models •Enhance eliminate items•Attention to distribution not returningquality good margin
“zone of strategic fit” Responsive Supply ChainResponsiveness Spectrum Efficient Supply Chain Certain Implied Uncertain Demand Uncertainty Demand SpectrumImplied Demand Uncertainty: The uncertainty that exists due to the portion ofDemand that the supply chain is required to meet.
Current Trends and Challenges in theSCM Increasing variety of products Decreasing product life cycles Increasingly demanding customers Fragmentation of Supply Chain Ownership: vertical vs. virtual integration Globalization and Market Segmentation “Closed Loop” SC Production Distribution Consumption Retrieval Disassembly/ Reverse Logistics and Disposal Reprocessing Re-manufacturing network