How critical is is a strategic fit for a company's overall success? We compared the competitive strategies of Nokia and Xiaomi to get a closer look.

1. ’
Topic 5
(36,37,38,39)1

2. Competitive Strategy Supply Chain Strategy
Strategic Fit is the perfect balance between the two 2

3. • Affordable family cars
• Latest technology at mid-range price
• High product and parts availability
A company’s competitive strategy defines, relative to its
competitors, the set of customer needs it seek to
satisfy through its product and services
Competitive Strategy of Toyota
3

4. Supply Chain strategy includes a specification of the broad
structure of the supply chain. It includes:
• Design decisions regarding inventory,
• Transportation,
• Operation facilities and
• Information flow
• The production facilities in each of its major
markets. For example, India.
• There are 2 production facilities of Toyota in
India making it the 4th largest vehicle
manufacturer in India.
Supply Chain Strategy of Toyota
4

5. It is the demand uncertainty imposed on the supply chain because
of the customer needs it need to satisfy.
The responsiveness of a supply chain determines how responsive a
supply chain is, to its customers in the process of meeting demand.
The goal is to target high responsiveness for a supply chain facing
high implied uncertainty and efficiency for a supply chain facing low
implied uncertainty
5

6. Responsive
Supply Chain
Responsiveness
Spectrum
Efficient
Supply Chain
Certain
Demand
Implied
Uncertainty
Spectrum
Uncertain
Demand
6

7. Competitive Strategy Supply Chain Strategy
Strategic Fit is the perfect balance between the two
• Very cheap smartphones
with medium range
capabilities.
• Only launching 2-3
models of phones a year
for limited customers.
• Good after sales service.
• The targeted market is
China.
• Only one retail store, that
is the Xiaomi website.
• Package delivery by 3rd
party.
• No physical retail store
but many service centers.
• Don’t leave any phone
unsold.
• Use flash sales as
marketing advantage.
7

8. ’
Xiaomi managed to grab 14% of China’s total mobile market at the end of 2014.
A perfect strategic fit brought the huge success of Xiaomi and made it the smartphone king in China
8

9. Strategic Fit is the perfect balance between the two
Competitive Strategy Supply Chain Strategy
• Cheap smartphones with
higher-mid range
capabilities.
• Expensive options for
high end users.
• Market expansion to
India, Bangladesh and
other Asian companies.
• Become a global provider
of smartphones.
• Online store for each
region.
• Physical retail stores in all
the big cities.
• Different distributors in
new regions.
• Retail stores maintaining
the same aesthetic
standards set by Xiaomi.
9

10. ’
Xiaomi managed to grab 6.3% of the total global mobile market share
by the end of 2016.
A perfect strategic fit brought the huge success of Xiaomi and
made it the 4th share holder of the global mobile market. 10

11. Strategic Fit diminishes as the sales decline
Competitive Strategy Supply Chain Strategy
• Since Nokia is widely
accepted, so adapt to
Windows OS, different to
what Samsung and Apple
offers.
• Maintain the similar
hardware quality as it is
accepted by its
customers.
• Use the existing costly
supply chain network
that has proved to be
trustworthy since years.
• Create more retail stores
to meet the anticipated
demand of Windows
phones.
11

12. ’
The customer’s didn’t find Windows OS very comfortable and
Nokia’s share started to decline
A very imbalanced competitive and supply chain strategy cost Nokia to fail drastically in the global mobile market
Competitive Strategy
Supply Chain Strategy
Strategic Fit is LOST
12

13. 13