What is Supply Chain Strategy

Supply Chain Strategy or Strategic Supply Chain Management is defined as: “A strategy for how the supply chain will function in its environment to meet the goals of the organization’s business and organization strategies”. There’s a kind of magic in some words, “strategy” and “strategic” being key examples. Place “strategic” in front of the name of any business process and suddenly that process acquires an aura of great importance. Strategic objectives cry out to be achieved in a way that simple objectives do not. Strategic planning sounds considerably more sophisticated and powerful than plain old planning. There’s a reason those words have such power. Strategy, originally a military term, is how generals marshal all available resources in pursuit of victory. Strategy wins football games and chess matches—or loses them.

It’s really the same in the business world. Each company has a business strategy that paints a broad picture of how they will compete in the marketplace. Since business strategy is like military strategy in that it requires the marshaling and organizing of all its resources, then it becomes clear that the business’s supply chain can be its most potent strategic resource. Designing and building the right supply chain, one that promotes the business strategies, may just be the most powerful way to gain an edge on the competition, to move faster, deliver more value, and be more flexible in the face of both steady change and surprises. The supply chain strategy is a complex and evolving means that organizations use to distinguish themselves in the competitive contest to create value for their customers and investors.

As illustrated in figure mentioned below, you can see how the direction of a firm or organization is predicated on its business strategy. Of course many organizations now also use mission and vision statements to give clarity to their purpose.

If these strategies are not aligned, the direction and fit will be askew. All three strategies are linked and dependent.

What is Strategy
Business Strategy and SCM

Get industry recognized certification – Contact us