Operations and Supply Chain Management - Supply Chain Organizational Strategies

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Meeting Market Demand
If you want to meet the volatile demands of the market with quality products and a timely delivery, it's important that you develop a strong supply chain strategy.
A supply chain strategy provides the plan for an organization's supply chain. While business strategies provide direction and guidelines for company processes, a supply chain strategy implements these guidelines by integrating business plans and extending them throughout all aspects of the company.
Supply Chain Organizational Strategies
Companies can use a number of generic business strategies in order to strengthen their position in the market:
differentiation,
cost leadership,
differentiation focus, and
cost focus.
Differentiation
A company selects a differentiation strategy when it wants to produce and deliver goods or services that customers perceive as being different from competition in ways that are important to them. It conducts market research to find out what customers want, and it then develops a product to uniquely meet those needs.
For example, a cell phone company might develop a phone that's more lightweight and sturdy than any other phone on the market.
Cost leadership
A company selects a cost leadership strategy when it wants to stress to customers that its product is cheaper than other similar products on the market. This strategy works best for products that are essentially similar. Customers might be more interested in better value than in apparently trivial differences between different offerings.
For example, an airline might offer passengers cheaper flights without any extras.
Differentiation focus
A differentiation focus strategy is similar to a differentiation strategy. However, it focuses on a small section of the market.
For example, a clothing company might offer designer clothing with matching accessories for its wealthier customers.

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