Assessment # 11

1. How will you relate an international organization to supply chain opportunities,

priorities and efforts?
Once a company has its international organization more aligned around
supply chain opportunities, priorities and initiatives, it is in a better position to select
external collaborative opportunities. In some respects, this is like placing bets – but not
like playing roulette, if managed carefully! There are new developments pertaining to
selecting opportunities downstream (with customers) and upstream (with suppliers and
partners). Specifically, the notion of being selective is key. Some argue that the term
‘partnership’ is one of the most inflated terms in modern business and it is well known
that you can only truly partner with a few.
2. Why is customer profitability analysis helpful?
Customer profitability analysis helps dispose of that shortcoming, as it
assesses an organization’s ability to profitably fulfill individual customer orders, and to
serve individual customer accounts and distribution channels with current supply chain
design and customer service systems. Essentially, this analysis changes the economic
starting point from internal costs to working from customer orders upstream. customer
profitability analysis enables focal firms to link supply chain efforts to customer value
and market opportunity in a way that improves customer relations and revenues in a
profitable manner. The concept of cost-to-serve shows that the supply chain contributes
significantly to profitability. Cost-to-serve also enables a local firm to home in on the
best growth opportunities, which would otherwise be difficult to identify.