Tutorial - Management Strategy

1. Why is supply chain strategy so important?

Supply chain strategy is important to operationalize and support the business strategy of a firm. Nowadays, supply chain strategy is critical backbone to business organization. Supply chain strategy must support the business strategy. If the business wants to have low cost provider, so the supply chain strategy support it.

 The effective market, availability of products at locations which hold the key to revenue recognition depends on the effectiveness of supply chain strategy.  Supply chain strategy also focuses on driving down operational costs and maximizing efficiencies. Also important to establish how well the relationship between us and the supply chain partners, including suppliers, distributors, and customers.

2.    How to develop a supply chain strategy?

To Develop a supply chain strategy, the first thing we must do is clearly understand how enterprise chooses to compete. It must do because for different competes will have different supply chain strategy.  Then, we must see the core competencies, focus, and means of differentiation in developing supply chain strategy. We must focus, are we want to gain supply chain efficiencies, or we want to differentiate our firm operationally by providing lower cost to customers, or giving more services than other firms.

3.    What are the differences that you have experienced in buying product through a physical retail store and an online store? What are differences in their supply chain strategy?

By my experienced, when I shopped in online store and physical retail store absolutely different. Shopping in online store is interesting, but sometimes the product that we buy is out of our expectations. For example is the quality of the product. When I saw on the site, I think it’s a good clothes, but after I bought it and sent to me, I was disappointed with the quality. But, it’s not for all online stores, just little of them.  Different with physical retail, I prefer to shop in physical store. Because in the store I can check and consider to buy the products. And the probability to disappoint of the product is little, because before we buy the product, we can check the product directly.

For the supply chain strategy, the consumers of online store must wait until several days to get the product. Although must wait for several days, the online stores still have their own business strategy to offer the product with lower price than in physical retail store. So, the lower price looks like a compensation for customers to wait for several days. And it could be one that attract custmomers to use online store to shop. 

Different with physical retail store, when customers want the product, they can buy it and directly get it without waiting for several days like online store. and sometimes the price in physical store higher that online shop, because they have rent retail cost that include in the price of the product. Although commonly  higher price, but customers will satisfy by get the product directly without waiting for days.

So, from this case, I can conclude that the supply chain strategy of a firm is important to make the customers satisfied. And it must be classified based on their business strategy, especially for online store and physical store that have different strategy of supply chain.