Chapter 3 - Strategic Initiatives for Implementing Competitive Advantages

Strategic Initiatives are divided into four organizations that are actually can undertake high-profile strategic initiatives including :

1. Supply chain management (SCM)
2. Customer relationship management (CRM)
3. Business process reengineering (BPR)
4. Enterprise resources planning (ERP)

1. Supply chain management 

• The management of information flows between and among stages in a supply chain to maximize total supply chain effectiveness and profitability.

 There are four basic components of supply chain management include:

•  Supply chain strategy - strategy for managing all resources to meet customer demand. For               example, the strategy is supply chain must record, produce the goods or services and find the             kind supplier that can give the better raw material to produce the product. 
• Supply chain partner - partners throughout the supply chain that deliver finished products, raw       materials and services. For example,supply chain must deal with the supplier to get the better               raw material from them to produce the better product that customer demand.
•  Supply chain operation - schedule for production activities. For example, the company must            arrange their facility location to easy employees transform raw material to the real product that             customers want. 
•  Supply chain logistics - product delivery process.How can we send our goods and services to          the customers? For example like we used car, lorry or others transportation to easy employee            do their work and customer will get their products or services with satisfaction.   

 Effective and efficient SCM systems can enable an organization to:

                  1)      Decrease the power of its buyers

                  2)      Increase its own supplier power

                  3)      Increase switching costs to reduce the threat of substitutes products or services

                  4)      Create entry barriers thereby reducing the threat of new entrants

                  5)      Increase efficiencies while seeking a competitive advantages through costs leadership

           

2.Customer Relationship Management                 

  

•  Involves managing all aspects of a customer’s relationship with an organization to increase customer     loyalty and retention and an organization’s profitability
•  Such as Charles Schwab and Kaiser Permanente, have obtained great success through the    implementation of CRM system.
•  It is not just technology, but a strategy, process and business goal that an organization must embrace  on an enterprisewide level
• ·It can enable an organization to:

           1)      Identify types of customers         
           2)      Design individual customer marketing campaigns

           3)      Treat each customer as an individual

           4)      Understand customer buying behaviors

3.Business Process Reengineering 

  

• The definitions of business process are a standardized set of activities that accomplish a specific task, such as processing a customer’s order. For example we must key in the customer’s data to the system. It is easy to the employee to refer if the customers make it order again our products or services.
• · BPR is the analysis and redesign of workflow within and between enterprises. It is the purpose of       BPR is to make all business processes best-in-class.

4.Enterprise Resource Planning

• Integrates all department and functions throughout an organization into a single IT system so that employees can make decisions by viewing enterprisewide information on all business operations.
• Keywords in ERP is a “enterprise”.
• Sample of ERP :