Chapter 2 - Supply Chain Performance: Achieving Strategic Fit and Scope

1. Business competition has shifted from company versus company to supply chain versus
supply chain. The scope of strategic fit comprises of functions with an organizations and
all stages in the supply chain. Discuss the above two statements and provide an industry
example to support the two statements.

A company’s goal is to get the product to the customer on time and under cost. The only
way to achieve that in this era is for your supply chain to be above the competition. An
example would be Kmart spending over a billion dollars on software that would help aid
their supply chain in planning systems and warehouse management. Kmart spent the
money to gain competitive edge over their competition. Kmart ultimately failed due to
implementation of the new software, but had they planned accordingly they would be in
competition with Wal-Mart and Kroger’s (Taylor, 2003).

Chopra and Meindl utilize the concept of strategy to denote what each function will try to
do particularly well. They inform us that product strategy gives outlines on the portfolio
of products that will be offered for sale by the company and product development
strategy specifies the importance of new products that the company will develop. A
marketing and sales strategy specifies how the market will be segmented and the products
of the company are positioned, priced and promoted. The supply chain strategy
determines the procurement process of the raw materials, transportation of materials,
manufacture of the product, distribution channels, warehousing and transportation of the
products, and the follow-up services (Business and Management University, 2011). An
important point: no one function can ensure the chain's success. However, failure at one
function may lead to failure of the overall chain (Chopra & Meindl, 2016). An example
would be Walmart and P&G.

2. What do you understand by demand uncertainty, implied demand uncertainty, and supply
uncertainty? Identify an organization and describe the different sources of uncertainty the
organization faces in each of the above categories.

Implied demand uncertainty is demand uncertainty imposed on a supply chain because of

customer needs. Demand uncertainty the uncertainty of customer demand product.
Supply uncertainty is the uncertainty of a developing new design and production are still
changing (Chopra & Meindl, 2016). Samsung launching into LED TVs which the
demand uncertainty as lower because customers were already watching tv. Supply
uncertainty when Samsung released it new lines of smart phones i.e. Note 7 and S7 edge.

Chapter 3 - Supply Chain Drivers and Metrics

1. Compare and contrast drivers that are used for price sensitive customers versus time
sensitive customers. Select a company/industry as a case.
 Price sensitive drivers would be facilities, inventory, and transportation. Each of these
drivers requires an interconnection between the three to keep the price down for
customers. Lockheed Martin has many locations for which it can store excess inventory
and each location has transportation needs. The price can rise due to a product/service not
being available. Time sensitive drivers would be sourcing, information, and pricing.
Without these drivers a company will be operating blindly. Not having these drivers
could increase lead times and ruin build schedules. An example would be Sikorsky
Aircraft. Sourcing, information, and pricing cripple their developmental helicopters.
According to Chopra & Meindl (2016), “Supply chain management includes the use of
logistical and cross-functional drivers to increase the supply chain surplus. These drivers
do not act independently but interact with each other to determine the overall supply
chain performance.”

2. Explain how an organization can increase its responsiveness through information and its
facilities.

Some ways to increase responsiveness is to improve the system for order information,
structuring flexible facilities to produce small amounts, and use of responsive
transportation. Each of these will be used to lower inventory costs (Chopra & Meindl,
2016, p. 45-46).

References

Business and Management University. (2011). Supply Chain Performance: Achieving Strategic

Fit and Scope - Review Notes - Business And Management University. Retrieved from

http://museum-madness.blogspot.com/2011/12/supply-chain-performance-

achieving.html

Chopra, S., & Meindl, P. (2016). Supply chain management: Strategy, planning, and operation.

Boston: Pearson.

Taylor, D. (2003, November 10). Supply Chain vs. Supply Chain | Computerworld. Retrieved

from http://www.computerworld.com/article/2573872/enterprise-resource-

planning/supply-chain-vs--supply-chain.html