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What is the Chase Strategy
Moniquie Huzzie
OPS/571
January 25, 2016
John Schobin

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What is the Chase Strategy?
Companies seeking to gain a competitive advantage by improving profits employ
strategies to effectively control inventory. The chase strategy addresses the functions of
matching demand and capacity. This strategy allow manager’s to utilize up to date statistics
essential for decision making and action taking in the hiring and firing process. This strategy is
best implemented when conditions of the business have large fluctuations in demand and a high
cost of lost business. (Jui-Chin & Kou-Huang, 2007).
When considering using the chase strategy, the benefits and drawbacks of the demand
matching strategy are addressed. The drawbacks to the chase strategy including: substantial
hiring, firing or laying off of employees. There may also be problems with labor unions when
firms are unionized. This practice can lead to low morale of employees. Another drawback of the
strategy is increased inventory carrying cost. By the nature of the strategy it addresses demand
and capacity on a period by period basis and this can lead to erratic utilization of plant
equipment. The advantages of the strategy are the cost savings for businesses that utilize low
skill workers during periods of high unemployment rates. ("Strategies For Meeting Demand",
n.d.). Services that cannot schedule customers such as supermarkets or banks, and other services
that do not have predictable patterns benefit from the chase strategy. Customer service can be
improved by increasing the number of employees available during peak periods of business as in
the example of restaurants that do not accept reservations and manufactures that provide
products seasonally. The strategy improves the comprehensive model of scheduling, inventory
carrying cost, marketing and just-in-time production concept.

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REFERENCE
Jui-Chin,J., & Kou-Huang,C. (2007, Jun). Developmentof a Collaborative Manufacturing,Planning and
Scheduling System:Integrating Lean and Agile Manufacturing for the supplychain. International Journal of
Mana, 24(2).
Strategies for meeting demand. (n.d.). Retrieved from
http://www.prenhall.com/divisions/bp/app/russellcd/PROTECT/CHAPTERS/CHAP11/HEAD03
.HTM