Importance Of An Effective Supply Chain Strategy

SUPPLY CHAIN MANAGEMENT: Effective supply chain management is one of the most important operational strategies that allow company to enjoy sustainable competitive advantage. More than the manufacturing expenses the distribution costs are high. If a retail firm has a proper supply chain management it can cut down the cost and have a competitive advantage of providing goods at lower cost. The cross docking concept that was introduced by the Wal-Mart was one of effective concept.

Supply-chain management consists of developing a strategy to organize, control, and motivate the resources involved in the flow of services and materials within the supply chain. A supply chain strategy, an essential aspect of supply chain management, seeks to design a firm’s supply chain to meet the competitive priorities of the firm’s operations strategy.

In the following sections I will propose a supply chain strategy which will align company goals and initiatives increasing efficiency and driving down cost thereby creating a sustainable competitive advantage through the implementation of a synergistic supply chain strategy.

Supply chain management is a practice that involves the planning, supervision, and implementation of strategies and controls to direct the movement of goods and services provided to customers. The intent of this essay is to incorporate a synopsis of existing literature and to provide the reader with a general understanding of how supply chain management correlates with the organizational design and structure of modern firms. The essay comprehensively reviews the components of supply chain management and their integration with functional areas within an organization. The information presented in this essay

Supplier chain strategies are one of the most important aspects of supply chain management. The key to success of an organization is the supply chain strategy. The supply chain makes up 55-85% to total costs for a business, so it is understandable why so many people are searching for newer and better strategies. (Bruce O. Bartschenfeld)

L. (2013). Performance benefits of harmonizing organizational strategy with strategy at supply chain level. Annals of the University of Oradea, Economic Science Series, 22(2), 581-586. Retrieved from http://search.ebscohost.com/login.aspx?direct=true&db=bth&AN=95035238&site=ehost-live&scope=site

The need to emphasize on all aspects of a supply chain is necessary, especially innovativeness, information, resources, outputs and flexibility, because their performance, which is based upon their management and processes, directly influences the competitive advantage of a company. Therefore, improving the performance of a supply chain is very critical for achieving competitive advantage. Improving the performance of a supply chain is not a one-time process rather, it’s a continuous process for the company and its supply chain network to sustain and gain further competitiveness (Cai et al., 2009).

Supply Chain Management: An International Journal Volume 17 · Number 1 · 2012 · 15 –28

Supply Chain Management has significantly evolved in recent time with the new technology that is now available for organizations. With the creation of new systems and enhanced technologies, organizations have been given the opportunity to improve their operations with new Supply Chain Management systems by having access to the tools necessary to understand issues in their supply chain and look for opportunities to become more efficient while minimizing costs and keeping their customers happy. Supply Chain Management is a systematic and strategic function within an organization that works cross functionally amongst the different departments from the creation of a service or product to the end consumer. This report

In order to reach supply chain “nirvana” several principles should be considered and followed. While these principles are not a “be all, end all” they will help guide the management to achieve an efficient and sustainable supply chain.

This paper describes the challenges of supply chains management. It examines the various areas that contribute to and organization 's strategic planning operations to enhance its profitability. It identifies the various elements of value to supply chain operations.

The strategic management of the supply chain does not consist of introducing innovations in order just to innovate. It is about creating a configuration that will make the strategic objectives progress. According to Slack et al. (2004, p.67) an « operations strategy concerns the pattern of strategic choices and actions that set the purpose, objectives and activities of operations ». According to Hayes (2005), efficient operations strategies need to be consistent and contribute to competitive advantage. The process of operations strategy covers the activities and dynamics of strategy elaboration and implementation (Swink and Way, 1995), whereas the content of operations strategy consists of the particular decisions regarding competitive priorities, objectives, and action plans that specify the operation 's strategic direction.Several authors gave their definition of operations strategy; four interrelated perspectives then emerged. The top-down approach is « what the business wants operations to do » and the bottom-up perspective represent « what day-to-day experience should do ». Top-down strategy can be distinguished from a bottom-up strategy in terms of two aspects: the initiative 's origin and the sequence of events amongst purposes, actions, and results. Top-down strategy is triggered by top management 's aims and manifests in the performance outcomes of stipulated actions. Bottom-up strategy is initiated by lower managers’ actions realizing their own interpretations

A supply chain strategy is frequently miss-understood with supply chain management, where supply chain actions are controlled to decrease costs, but with supply chain strategy it defines how the supply chain should function in order to compete. Supply chain strategy is an iterative method that evaluates the cost benefit trade-offs of prepared components. A well accomplished supply chain strategy results in value creation for the business.

An effective supply chain management is critical to success in today’s business environment where competition, risk and uncertainty are challenging. Ahenkora and Peasah (2011, p.278) state that ‘the need to deliver on clear strategic choices in today’s hypercompetitive business and uncertain environment is greater than ever’.

To succeed in today’s competitive markets companies must learn to align their supply chains with the demand of the markets they serve. Supply chain performance is now a distinct competitive advantage for companies who excel in this area.