The Supply Chain Strategy Should Be Lean Or Agile?

1566 Words Jan 14th, 2015 7 Pages
To what extent the Supply Chain Strategy should be Lean or Agile?
Company’s goals and mottos are crucial determinant expressions that indicate the business nature and value through different combinations of business operation along with demand profiles which identify the diverse functionalities of business enterprises. To begin with, Tesco’s motto emphasizes the focus on customer’s value and long-term loyalty. As Christopher and Towill (2001) suggested that the critical principles of agility are the total value and service level offered to customers, therefore, Tesco’s are likely to adopt agility as the essence of their key business strategies. Furthermore, from demand profile perspective, Tesco also offers their customers a wide variety of products including food and non-food categories. Therefore, such characteristic of the high product variety available to customers exhibited the concept of agility suggested by Basu and Wright (2008). On the other hand, both Aldi and Lidl prioritize their business at a low price and cost minimization basis. These two companies intended to lower their costs of operation, such as the elimination of non-value adding service and no-frills approach, and pass the benefits on to customers in the form of lower price products. Moreover, according to the case, both companies offer less product range than other mainstream retailers such as Tesco. Therefore, the concept of lean should be adopted by these two companies as their functionalities…

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