chapter 3 : strategic initiatives for implementing competitive advantages

STRATEGIC INITIATIVES

↠Organizations can undertake high-profile strategic initiatives including:

➽SUPPLY CHAIN MANAGEMENT (SCM)

⤷involves the management of information flows between and among stages in a supply chain to maximize total supply chain effectiveness and profitability.

⤔ 4 basic component of supply chain management include :
i)supply chain strategy-strategy for managing all resources to meet customer demand
ii)supply chain partner- partners throughout the supply chain that deliver finished products,raw             materials and services.
iii)supply chain operation-schedule for production activities
iv)suppy chain logistics-product delivery process

⤔Wal-Mart Procter & Gamble (P&G) SCM

⤔Effective and efficient SCM  systems can enable an organization to:

-decrease the power of its buyers

-increase its own supplier power

-increase switching costs to reduce the threat of substitute products or services

-create entry barriers thereby reducing the three of new entrants

-increase effciencies while seeking a competition advantage through cost leadership 

⤔Effective and efficient SCM systems effect on Porter's Five Forces

➽CUSTOMER RELATIONSHIP MANAGEMENT(CRM)

↪ managing all aspects of a customer's relationship with an organization to increase customer loyalty and retention and an organization's profitbility.

- not just technology,but a strategy,process and business goal.

- an organization to : 

• Identify types of customers.
• Design invidual customers marketing campaigns.
• Treat each customer as an individual.
• Understand customer buying behaviors.

➽BUSINESS PROCESS REENGINEERING(BPR)

- Business process : a standardized set of activities that accomplish a specific task,such as processing a customer's order.
- Business process reengineering (BPR) : the analysis and redesign workflow within and between enterprise.

• he purpose of BPR is to make all business processes best-in-class.

- Reengineering the Corporation : book written by Micheal Hammer and James Champy that recommends 7 pprinciples.

1. Organize around outcomes,not tasks.
2. Identify all the organization's processes and prioritize them in order of redesign urgency.
3. Integrate information processing work into real work that produces the information.
4. Treat geographically dispersed resources as though thy were centralized.
5. Link parallel activities in the workflow instead of just integrating their results.
6. Put the decision point where the work is performed and build control into the process.
7. Capture information once and at the source.

Finding Opportunity Using BPR

Company can improve the way travels the road by moving from foot to horse and then horse to car.

- BPR looks at taking a different path, such as an airplane which ignore the road completely.

- Progressive Insurance mobile claims process.

- Types of change an organization can achieve,along with the magnitudes of change and the potential business benefit.

Enterprise Resource Planning(ERP)

- Integrates all departments and functions throughout an organization into a single IT system so that employees can make decisions by viewing  enterprisewide information on all business operations.

- ENTERPRISE

- ERP systems collect data from across an organization and correlates the data generating and enterprisewide view.