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Hi Sir,
The process for achieving strategic fit is given below:
Strategic fit between competitive strategy and supply chain strategy refers to the consistency between the customer needs that the competitive strategy aims to satisfy and the supply chain capabilities that the supply chain strategy aims to build. Chopra and Meindl stated 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.Three steps are involved.1. Understanding the customer needs regarding attributes of supply.2. Understanding the supply chain attributes (alternatives available).3. Achieving strategic fit. Making decision on the supply chain to best serve the needs of the target segment customers.
Achieving strategic fitThe greater the implied demand uncertainty, the more responsive a supply chain has to be. More responsive supply chains are more costly supply chains. When compared directly with less responsive but more efficient supply chains, their costs may look excessive.
Expanding the Supply Chain Optimization and Strategic Fit ScopeIntracompany Intraoperation scope: The most limited scope over which strategic fit and optimization can be attempted is one with operation within a functional area in a company.Intracompany Intrafunctional scope: If the competitive strategy and supply chain strategy are aligned across all the operations functions of the company and optimization is attempted in an integral manner including the raw material inventory, manufacturing operations, finished goods inventory and warehouse, and transportation, the scope is extended to intracompany intrafuctional level.Intracompany Interfunctional scope: At this level of scope, the entire company's activities are viewed and modeled as one single system, and optimization is done and company profit is maximized.Intercompany Interfunctional scope: The Maximum Supply Chain Surplus view: At this level of optimization and fit making, the entire supply chain is modeled as a system and optimization and fit is designed so that supply chain surplus is maximized.Flexible Intercompany interfunctional scope: The flexibility refers to dynamic situation. Physically, the participants in the supply chain keep changing, products keep changing, technologies keep changing, facilities keep changing. Mathematically, there are changes in number of variables and variable values. A supply chain capable of optimizing and fit making dynamically is a flexible intercompany interfuctional scope supply chain.
