Achieving Strategic Fit

Similarly, Toyota s decision to have production facilities in each of its major markets is part of its supply chain strategy. 

In the next section, we elaborate on this notion of fit and seek to answer this question  

Given its competitive strategy, what should a company s supply chain try to do particularly well  

The different functions in a company must appropriately structure their processes and resources to be able to execute these strategies successfully. 

The design of the overall supply chain and the role of each stage must be aligned to support the supply chain strategy. 

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Explain why achieving strategic fit is critical to a company s overall success. 

Describe how a company achieves strategic fit between its supply chain strategy and its competitive strategy. 

Chapter 2 Supply Chain Performance Achieving Strategic Fit and Scope... 

What does a company need to do to achieve that all-important strategic fit between the supply chain and competitive strategies A competitive strategy will specify, either explicitly or implicitly, one or more customer segments that a company hopes to satisfy. To achieve strategic fit, a company must ensure that its supply chain capabilities support its ability to satisfy the needs of the targeted customer segments. 

Achieving strategic fit If a mismatch exists between what the supply chain does particularly well and the desired customer needs, the company will either need to restructure the supply chain to support the competitive strategy or alter its competitive strategy. 

The first step in achieving strategic fit between competitive and supply chain strategies is to understand customers and supply chain uncertainty. Uncertainty from the customer and the supply chain can be combined and mapped on the implied uncertainty spectrum. 

The next step in achieving strategic fit is to assign roles to different stages of the supply chain that ensure the appropriate level of responsiveness. It is important to understand that the desired level of responsiveness required across the supply chain may be attained by assigning different levels of responsiveness and efficiency to each stage of the supply chain as illustrated by the following examples. 

The final step in achieving strategic fit is to match supply chain responsiveness with the implied nncer-tainty from demand and supply. The supply chain design and all functional strategies within the firm must also support the supply chain s level of responsiveness. 

The concept of tailoring to achieve strategic fit is important in industries such as high-tech and pharmaceuticals, in which innovation is critical and products move through a life cycle. Let us consider changes in demand and supply characteristics over the life cycle of a product. Toward the beginning stages of a product s life cycle ... 

In the next section, we describe how the scope of the supply chain has expanded when achieving strategic fit. We also discuss why expanding the scope of strategic fit is critical to supply chain success. 

When supplying multiple customer segments with a wide variety of products through several channels, a firm must tailor its supply chain to achieve strategic fit. 

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