Creation of Competitive Advantage in an Optimal Supply Chain
Zachary Drumm
Abstract
Competitive advantage creation allows control over supply chains and allows for more supplier opportunities. It also allows there to be an edge over the competitors and be able to have a better chance at getting better suppliers. To be able to create a competitive advantage it takes many things. Some of the things are to collaborate, stick to the goal, and be able to handle tough situations. Before this though you need to have an optimal supply chain which is all about having a perfect supply chain that can balance the efficiency and responsiveness at a low cost. After achieving that you can create your competitive advantage by making sure you have advantages
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This work and planning will all be focused on balancing the efficiency and responsiveness at a low cost. This is done through whatever plan you have for your supply chain and what business are in it. First is to focus on being able to be efficient enough. This means being able to make products at a good enough rate so that way not too many is made and not too little is made. This has to do a lot with the market and such and this is why you then focus on responsiveness. The responsiveness of a supply chain makes all the difference because it is all about being able to adjust to the market. To obtain this you have to have great communication and be able to coordinate throughout the supply chain. Once the supply chain is able to do those two things it must be able to do it at a low cost. To do that the supply chain needs to practically master agility, quality, and quantity. Once it does that it can minimize costs and produce goods for a lower costs. (What is supply chain optimization, …show more content…
To make sure you can keep the competitive advantage you should make sure you stick to six key things. These six key things are collaboration, sticking to the goal, recognizing the complex and managing the simple, treating issues and not symptoms, focusing on the cost drivers and business impacts, and don’t waste an idea. Collaboration means that you need to continuously work with your supply chain as a unit and attack problems together. Sticking to the goal is a key thing because you can become off target and so you need to make sure you follow the goal you set and stick with it. Recognizing the complex and managing the simple is a key thing and it means you need to handle and spot the complex situations and take care of even the simplest things. Treating issues and not symptoms is a key thing that means that you need to make sure you are treating everything and not just the little problems to something big because it can become worse. Focusing on the costs driven and business impacts means that you need to remain focused on what adds up in your costs so that way you do no spend more. Not wasting an idea is the last key that means that any idea needs to be taken into consideration because it can become up big. Whether it is a product or an idea on how to solve something you should consider it because it could help
To accomplish competitive advantage, and differentiation three elements are crucial; stating the strategies and practicalities, focusing on knowledge based behaviour, and improving the customer relationship management.(Slater and Narve 1995).
A competitive advantage is essential to an effective strategy (Thompson, Peteraf, Gamble, Strickland III, & McGraw-Hill, 2013, pp. 12). Without a competitive advantage, Costco would soon be struggling to make ends meet. Based on Costco’s growth between 2000 and 2011, it appears that Costco has been building a competitive advantage, one that focuses on meeting the customer and employee needs before making a profit. Although this means that profits will be slightly lower, it does seem to be working as there is an almost continual growth in the
Building blocks of the competitive advantage is very effectiveness, worth, improvement and customer approachability. These particular building blocks in general have four common techniques in cutting down and getting excellence. Anyone can have the capabilities in implementing these.
Understanding the needed supply chain capabilities before one sets out to operate in a global market place is a good idea, before trying to find and fill the holes in the dike are needed. Implementing a strategic plan that can be rapidly duplicated throughout the organization, strengthen supplier relationships, set quality expectations for suppliers by using a supplier performance score card to measure compliance. Optimize logistics and manufacturing capabilities, synchronize business units using information technology, and in order to drive organizational efficiencies create a culture of action. Set goals for a sourcing strategy. This means internal, or possibly external, personnel who can build new capabilities seamlessly. The following areas of performance can help identify the highest priorities as follows:
Below are some of the competitive advantages (or factors which led to competitive advantages) I identified in the case:
Competitive advantage is the advantage for the competitors and gained by the offerings from the consumers that have the greater value either by the low prices of the products and by providing the benefits and services to the consumers that denotes the high price. It is a set of the innovative and different features of the company and the products and services sale to the consumers so that company can achieve the targets what they have decided and it is the betterment for the enterprise in the competitive market (Porter, 2011). There are three determinants which can be used in the competitive advantage that what the company produce for their consumers, their target market that what they have to achieved and the competition from the other entity
The intensive competition will lead companies to move in a global direction to increase revenue. However, every company strives to initiate and or create a competitive advantage in regards to their goods and services or whatever the company is offering. Core competencies are what lead companies to form a joint venture, partnerships, alliance, and cooperative strategies. Per (Michael & Hitt, 2017) “because firms reallocated and have similar needs, it’s easier for them to jointly work together, for example, United States alliance between Ford and General Motors in developing upgraded nine and ten-speed transmission.” By combining the companies, it turns out to be a complementary asset and enhances the quality of the products. For
The business environment is increasingly becoming competitive and challenging. In the recent past, manufacturers have found themselves facing the threat of dwindling profit margins due to unfortunate global events such as the 2007 global financial crisis and the on going Europe economic crisis. The need to improve operation efficiency so as to ensure current and future investment yield the highest rate of return has therefore become extremely important. Manufacturers are now actively engaged in, managing their costs, Research and Development, adopting best procurement strategies, among other Actions. While such actions might eventually lead to positive results, additional business value can be achieved through proper management of the supply chain (Waymer, Ivanaj & Mussa 2009; Krivda 2004).
Competitive advantage is an advantage that a company has over its rivals, permitting it to produce more prominent deals or edges and/or hold a larger number of clients than its rivals. Upper hand results from coordinating the chances to the center abilities. The objective of core competencies is to construct world initiative in configuration and advancement of a specific class of item usefulness. Having focal points and control over core products is critical for a few reasons. A predominant position in core competencies and core products empowers an organization so shape the development of utilizations and end markets.
Managing employees contribute to a competitive advantage because employees know what is expected of them. Employees need to be given goals, motivated, and taught the company’s values. If companies did not manage employees, the company would not function at an optimal rate or even fail.
Thompson, A.A., Strickland, A.J., & Gamble, J. E. (2010). Crafting and executing strategy: The quest for competitive advantage: Concepts and cases: 2009 custom edition (17th ed.). New York: McGraw-Hill-Irwin
There are a variety of challenges that firms may face when attempting to be the best in their specified industry. Economic and political challenges can make it difficult for companies to maintain a competitive advantage. In addition to maintaining a competitive advantage, some firms also find difficulty in keeping its branding alive and by attracting customers as their strategies, products, and management change over the course of time. Industries such as the automotive industry, healthcare industry, retail industry, and many more experience a variety of challenges based on their competition. Firms must create successful strategies in order to maintain competitive with their competition and in order to gain advantages in their industry (Hitt, 2013).
Today’s organizations are faced with increasing levels of global competition, customer’s demanding value for their money and high stakeholders expectations on investment returns. Gattorna (2003), notes that firms are now pursuing supply chain management as a strategy to competitive advantage. Firms in a supply chain relate, transact, and partner on different levels; from product design and development to product delivery. Through supply chain management a firm pursues value creation through timely product delivery, cost management, inventory control and customer service (Beamon, 1999).They do so individually or through synergies formed with other organizations to increase customer service
We can define competitive advantage as simply what a given company excels best at. This could be the distinguishing factor as to why consumers purchase from your company and not the competition. This could also be understood from the perspective of quality that a business can create for the consumer.
of a firm to attain new forms of competitive advantage (Müller, 2011). It is due to these