M1A1 Supply Chain Strategy & Competitive Priority How do companies like FedEx and Walmart manage their supply chain systems to maintain a competitive advantage in today’s business world? According to Nada Sanders (2012), it’s done through the active management and implementation of the five primary competitive priorities; Cost, Time, Innovation, Quality, and Service, as well as an effective supply chain strategy. Supply chain strategy design is composed of the five competitive priorities, and how those priorities are implemented and managed helps create and maintain a competitive advantage in the business world. FedEx and Wal-Mart both utilize competitive priorities to effectively operate an expansive Supply Chain Management (SCM) system,
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According to Soni (2015), Cross-Docking is an inventory management control system that moves products directly from one inbound freight truck to the waiting outbound truck, saving the company billions in warehousing costs annually. The efficiency in product movement keeps costs down, and works with Wal-Marts strategy to provide low cost merchandise to customers every day, as well as provides the retailer the flexibility to provide incentive programs such as Save Even More, Ad Match, Savings Catcher, and rollbacks on pricing (Soni, 2015). Wal-Mart also implements the competitive priorities of quality, service, and time, but they are implemented to support the primary goal of cost savings as a function of their business model and strategy.
How would FedEx or Wal-Mart have to change their supply chain strategy if their supply chain competitive priorities changed? Both would have to consider the ramifications of reprioritizing their SCM system, but FedEx would require a much larger shift based on the current priority of time and …show more content…
By changing its competitive priority from time to cost, as an example, the organization would have to change its business model primarily, which would effectively eliminate its competitive advantage in the marketplace of air freight delivery. The business model change would require changes in distribution facilities, as well as downsizing satellite and companion facilities for package pick-up and delivery. Vehicle and aircraft fleets would need to be reduced along with the employee population. A shift in competitive priorities for a corporation like FedEx would destroy the brand of the company and drive the organization out of the competitive air freight market.
Competitive priorities are crucial to the survival of any company, and the priorities should be aligned with the organizations business model, corporate strategy and goals. Appropriate prioritization and the utilization of all the competitive priorities assures a business it will compete, thrive, and remain competitive for market share and competitive advantage in the global business world (Sanders,
According to Soni (2015), Cross-Docking is an inventory management control system that moves products directly from one inbound freight truck to the waiting outbound truck, saving the company billions in warehousing costs annually. The efficiency in product movement keeps costs down, and works with Wal-Marts strategy to provide low cost merchandise to customers every day, as well as provides the retailer the flexibility to provide incentive programs such as Save Even More, Ad Match, Savings Catcher, and rollbacks on pricing (Soni, 2015). Wal-Mart also implements the competitive priorities of quality, service, and time, but they are implemented to support the primary goal of cost savings as a function of their business model and strategy.
How would FedEx or Wal-Mart have to change their supply chain strategy if their supply chain competitive priorities changed? Both would have to consider the ramifications of reprioritizing their SCM system, but FedEx would require a much larger shift based on the current priority of time and …show more content…
By changing its competitive priority from time to cost, as an example, the organization would have to change its business model primarily, which would effectively eliminate its competitive advantage in the marketplace of air freight delivery. The business model change would require changes in distribution facilities, as well as downsizing satellite and companion facilities for package pick-up and delivery. Vehicle and aircraft fleets would need to be reduced along with the employee population. A shift in competitive priorities for a corporation like FedEx would destroy the brand of the company and drive the organization out of the competitive air freight market.
Competitive priorities are crucial to the survival of any company, and the priorities should be aligned with the organizations business model, corporate strategy and goals. Appropriate prioritization and the utilization of all the competitive priorities assures a business it will compete, thrive, and remain competitive for market share and competitive advantage in the global business world (Sanders,