Describe how a company achieves strategic fit between its supply chain strategy and competitive strategy?
What does a
company need to do to achieve that all-important strategic fit between the
supply chain and competitive strategies? A competitive strategy will specify,
either explicitly or implicitly, one or more customer segments that a company
hopes to satisfy. To achieve strategic fit, a company must ensure that its
supply chain capabilities support its ability to satisfy the targeted customer
segments
There are three
basic steps to achieving strategic fit:
1.
Understanding the customer and supply
chain uncertainty.
First a company
must understand the customer needs for each targeted segment and the
uncertainty the supply chain faces in satisfying these needs. These needs help
the company define the desired cost and service requirements. The supply chain
uncertainty helps the company identify the extent of disruption and delay the
supply chain must be prepared for.
2.
Understanding the supply chain
capabilities.
There are many
types of supply chains, each of which is designed to perform different tasks well.
A company must understand what its supply chain is designed to do well.
3.
Achieving strategic fit.
If a mismatch
exists between what the supply chain does particularly well and the desired
customer needs, the company will either need to restructure the supply chain to
support the competitive strategy or alter its strategy.
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