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Supply Chain Management (3rd Edition) : Supply Chain Performance: Achieving Strategic Fit and Scope
Supply Chain Management (3rd Edition) : Supply Chain Performance: Achieving Strategic Fit and Scope
(3rd Edition)
Chapter 2
Supply Chain Performance:
Achieving Strategic Fit and Scope
2007 Pearson Education
2-1
Outline
Marketing
and
Operations
Sales
Distribution
Service
Introduction
How is strategic fit achieved?
Other issues affecting strategic fit
Strategic fit:
Consistency between customer priorities of competitive
strategy and supply chain capabilities specified by the
supply chain strategy
Competitive and supply chain strategies have the same
goals
Lot size
Response time
Service level
Product variety
Price
Innovation
Implied
Demand
Uncertainty
Salt at a
supermarket
An existing
automobile
model
Highly uncertain
supply and demand
A new
communication
device
Low Implied
Uncertainty
High Implied
Uncertainty
Product margin
Low
High
10%
40%-100%
1%-2%
10%-40%
10%-25%
Low
High
2007 Pearson Education
Low
Cost
Responsiveness Spectrum
(Figure 2.4)
Highly
efficient
Integrated
steel mill
Somewhat
efficient
Hanes
apparel
Somewhat
responsive
Most
automotive
production
Highly
responsive
Dell
of it
e
F
n
Zo egic
t
ra
t
S
Responsiveness
spectrum
Efficient
supply chain
Certain
demand
2007 Pearson Education
Implied
uncertainty
spectrum
Uncertain
demand
Responsive
Primary goal
Lowest cost
Quick response
Modularity to allow
postponement
Pricing strategy
Lower margins
Higher margins
Mfg strategy
High utilization
Capacity flexibility
Inventory strategy
Minimize inventory
Buffer inventory
Transportation strategy
Greater reliance on
responsive (fast) modes
Five categories:
Retailer
Customer
Competitive
Strategy
Product
Development
Strategy
Supply Chain
Strategy
Marketing
Strategy
Intercompany
Interfunctional
Intracompany
Interfunctional
at Distributor
Intracompany
Intrafunctional
at Distributor
Intracompany
Intraoperation
at Distributor