STRATEGIC INITIATIVES FOR
IMPLEMENTING COMPETITIVE ADVANTAGES
1)Organization
can undertake high-profile strategic initiatives including:
Ø Supply chain management(SCM)
Ø Customer relationship management(CRM)
Ø Business process re engineering(BPR)
Ø Enterprise resource planning(ERP)
I)
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 components of include:-
o Supply chain strategy>strategy for managing
all resources to meet customer demand.
o Supply chain partner>partners throughout the
supply chain that deliver finished products, raw materials and services.
o Supply chain operation>schedule for production
activities
o Supply chain logistics>product delivery
process
-Effective and efficient SCM systems
can enable an organization to:-
o Decrease the power of its buyers
o Increases its own supplier power
o Increases switching costs to reduce the threat of
substitute products or service
o create entry barriers thereby reducing the threat
of new entrants
o Increase efficiency while seeking a CA through
cost leadership
-Effective and efficient SCM systems
effect on Porter’s Five Forces
Decreases =buyer power
= Threat of substitute products or service
=threat of new entrants
Increases =Supplier Power
2) Customer relationship
management (CRM)
§ Involves managing all aspects of a customer
relationship with an organization to increases customer loyalty and retention
and an organization profitability
§ Many organizations such as Charles Schwab and
Kaiser Permanente have obtained great success through the implementation of CRM
systems.
§ IT is just not technology but a strategy process
and business goal that an organization must embrance on an enterprise wide
level.
§ CRM can enable an organization to:-
>Identify types of customers
>Design
individual customer marketing campaigns
>Treat each
customer as an individual
>Understand
customer buying behavior
3)Business
Process Reengineering
ü Business process=A standardized set of activities
that accomplish a specific task such as processing a customer order
ü Business process reengineering(BPR)=the analysis
and redesign of workflow within and between enterprises
-The purpose of
BPR is to make all business process best-in-class
ü7 principles of business process reengineering
(1)Organize around outcomes not tasks
(2)Identify all the organization process
and prioritize them in order of redesign urgency
(3)Integrate information processing work
into the work that produces the information
(4) Treat geographically dispersed
resources as though they 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
ü Finding opportunity using BPR
-the
ways it travel the road by moving from foot to horse and then horse
-BPR
look at taking a different path such as airplane which ignore the road completely
-types of
change an organization can achieve along with the magnitudes of change and the
potential business benefit.
4)Enterprise Resource Planning
·
Integrates
all departments and functions throughout an organization into a single IT
system so that employees can make decision by viewing enterprise wide
information on all business operations.
·
Keyword in
ERP is “enterprise
·
ERP systems
collect data across an organization and correlate the data generating an
enterprise wide view.
