Developing Market Specific Supply Chain Strategies
Developing Market Specific Supply Chain Strategies by Gian Andrea Manzoni
Business Operations: Systems Perspectives in Global Organizations
Walden University
14th June 2015
Developing Market Specific Supply Chain Strategies
In today’s business environment, companies have to deal with demand volatility and cost reduction. Firms want to grow efficiently and flexible, but many of them have failed: the main reason was that they were not able to develop a specific supply chain (SC) strategy. Scholars defined that the root cause of these failures was due to the limited knowledge of SC and the costs involved, and the impact of SC in their operations (Mentzer, Myers, & Stank, 2007). These firms were not able to produce with competitive cost and/or respond efficiently to the market demand. Companies have to understand the circumstances of the market and their operational capacity before undertake any SC strategy (Ambe, 2012). In fact, the concept of one size fits all does not work with the SC design, implementation, and control (Christopher, Peck, & Towill, 2006; Christopher & Towill, 2002). Consequently, organizations have to develop SC strategies upon concurrent market characteristics if they want to achieve higher responsiveness to customer demand while reducing the overall SC costs.
An effective SC management requires setting challenging objectives, and it is a critical success factor for today’s businesses. Organizations need therefore to make strategic decisions and implement competitive strategies that add value to the enterprise (Lee, 2002). These procedures entail the enhancement of SC capabilities such as flexibility, cost reduction, process efficiency and increased service level (Ismail & Sharifi, 2006). Therefore, it is essential that the management understand the customers’ needs and the market competition, and consequently chooses and the right strategy in order to satisfy their demand. One objective the SC strategies have all in common: to
Business Operations: Systems Perspectives in Global Organizations
Walden University
14th June 2015
Developing Market Specific Supply Chain Strategies
In today’s business environment, companies have to deal with demand volatility and cost reduction. Firms want to grow efficiently and flexible, but many of them have failed: the main reason was that they were not able to develop a specific supply chain (SC) strategy. Scholars defined that the root cause of these failures was due to the limited knowledge of SC and the costs involved, and the impact of SC in their operations (Mentzer, Myers, & Stank, 2007). These firms were not able to produce with competitive cost and/or respond efficiently to the market demand. Companies have to understand the circumstances of the market and their operational capacity before undertake any SC strategy (Ambe, 2012). In fact, the concept of one size fits all does not work with the SC design, implementation, and control (Christopher, Peck, & Towill, 2006; Christopher & Towill, 2002). Consequently, organizations have to develop SC strategies upon concurrent market characteristics if they want to achieve higher responsiveness to customer demand while reducing the overall SC costs.
An effective SC management requires setting challenging objectives, and it is a critical success factor for today’s businesses. Organizations need therefore to make strategic decisions and implement competitive strategies that add value to the enterprise (Lee, 2002). These procedures entail the enhancement of SC capabilities such as flexibility, cost reduction, process efficiency and increased service level (Ismail & Sharifi, 2006). Therefore, it is essential that the management understand the customers’ needs and the market competition, and consequently chooses and the right strategy in order to satisfy their demand. One objective the SC strategies have all in common: to
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