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Building a Sustainable Competitive Advantage. College of Business. University of Mary Washington. Fredericksburg, VA San Francisco, CA This paper analyzes cross-industrial best practices and future trends in the context of the contemporary resource based competitive advantage model of the firm. It identifies key managerial levers, tools and systems that can be used to build and sustain a Hi-Technology company's core competences in order to facilitate a more innovative, collaborative 21st century corporate culture.
A qualitative and quantitative assessment is made of how a firm's leadership, human capital management, organizational culture, design and systems can all collectively merge to create a more dynamic and responsive organization which is far more adept at building unique resources and capabilities, which can then be leveraged to create new market opportunities with high competitive entry barriers.
Keywords: competitive advantage; strategy; sustainability. To achieve competitive advantage, firms need to constantly focus on the identification of differential product strategies, building or reshaping core competencies, acquiring unique technologies, and accumulation of intellectual property, all of which can all be harnessed to make the company successful in a highly competitive marketplace.
This problem has become even more complex with globalization and the growth of the internet, which has given open access to more competitive, environmental, and technological information.
One key model that was developed in the 's modeled core competencies as unique "resources and capabilities". This was known as the resource based view of the firm Grant, Therefore, using this model as a foundation, this research will analyze i which key organizational levers influence the competitive advantage s of a firm, ii propose recommendations as to how 21st century high technology firms can strategically manage their resources and capabilities for a sustained competitive position and iii validate and quantify the general perception of the relative importance of these organizational resources and capabilities using a online survey and statistical analysis techniques.
This used very simple concepts and tried to distinguish in the first order between the impact of internal and external factors on a firm's ability to compete. In order to identify potential product and market strategies the SWOT technique forced companies to look systematically at the following aspects of their industry and their firm: Strengths: Attributes of an organization that help to achieve a competitive position; Weaknesses: Attributes of an organization that are harmful to a firm's competitive position; Opportunities: External environmental conditions that help achieve a competitive position; Threats: External environmental conditions which could damage a firm's competitive position.
The aim of a "SWOT" analysis is to identify the key factors that are important to the achievement of the firm's objectives. One of the weaknesses of SWOT analyis is that it can be used to generate a "brainstormed" list of opportunities rather than a thoughtful list of what is strategically important in helping a firm achieve it's objectives.
A more contemporary analysis model by Porter brought a greater depth of understanding of a firm's relative competitive position within a given industry, providing analysts with a clear framework for assessing the effect of the external environment on a firm's ability to sustain a competitive advantage. A detailed description of how these various factors interact was discussed by Porter but summarized here:. If a firm has many competitors, and they offer equally attractive products and services, then most likely the firm will have little power and influence.
If suppliers and buyers do not get a good deal, they will go elsewhere. Alternatively, if no one else can do what your firm does, then you have more competitive strength. If product or service substitution is viable, then this weakens the competitive power of a firm.
If it costs little in time or money to enter the market and compete effectively, if there are few economies of scale in place, or if little protection for key technologies, then new competitors can enter a market, weakening an incumbant's position. Strong and durable barriers to entry aid in sustaining a competitive advantage. Porter's five force model was considered by many to have shortcomings in that it integrates both internal and external factors that allow a firm to identify and sustain its sources of competitive advantage Pitkethly, and was is too static to keep pace with the more influential technological progress exhibited in many industries Five Forces Model, n.
Other forces have become significant in the understanding of industry dynamics; e. In the 's a model was proposed by Wernerfelt and augmented by Barney , which tackled the problem related to the identification of the elements that comprised a firm's competitive advantage.
This surmised that firms can only create sustained high performance if they have superior "Resources" coupled with the company's "Capabilities" and are constantly protected from migration.
According to Gautam, Barney, Muhanna and Ray , Barney surmised that multiple resources and capabilities form the highest of the competitive entry barriers. This model Fig. In order to create a true cost or differentiation advantage, Barney surmised that a firm's resources and capabilities must be:.
The VRIN resource characteristics are individually necessary, but not sufficient for a sustained competitive advantage. Empirical research was reported by Collins where he described the special "characteristics" of successful great companies that have enjoyed sustained competitive advantage.
He concluded that truly good-to-great companies shared five commonalities, including:. He described these CEOs as "Level 5 leaders" that continually focus on what it takes to sustain success in the long term.
Collins found that bureaucratic cultures arose in companies that had a lesser degree of competence and lack of discipline. They determine what technology makes most sense to them and then pioneer novel applications to enhance their business. There are likely many contributing factors that influence a firm's competitive position and it is likely a combination of many VRIN resources and capabilities that will determine the type of company product or service differentiation.
Porter's generic differentiation strategies highlight four possible company strategies that could be adopted depending on the type of market and the type of company differentiation. It is necessary for a firm to continuously identify and nurture the VRIN resources and their complementary capabilities to a create product s that are continuously attractive in the highest value market segments in order to be successful for the long term. Identifying the exact mixture of resources and capabilities that truly provide sustained differentiation is not easy.
Some of the major organizational levers that are highly likely to influence a company's competitive advantage are:. These organizational levers represent some of the fundamental control systems that can influence a firm's competitive advantage.
However, achieving differential performance on one of these areas will certainly not guarantee sustained success. These elements in turn can be distilled down further to identify the fundamental VRIN resources or capabilities, which are critical to sustaining a firms' competitive advantage. The major organizational levers that influence a firm's ability to compete successfully will now be discussed, along with historic factors and then augmented by the introduction of more contemporary ideas for optimizing a foundation for a sustained competitive advantage.
Vision, Mission, Leadership and Governance. It is common for firms to capture and commit their major goals and corporate philosophy in writing as "vision" and "mission" statements Birnbaum, n. These statements of purpose should describe the firm's fundamental reason for existing, and are typically complementary to a firm's underlying strategy and the represent a powerful message, provided it is compelling, accurate, constantly reinforced and communicated clearly to all levels inside and outside the organization.
The mission statement defines the company's current business, its objectives and its approach to reach those objectives by articulating the following:. The vision statement should be simple to understand and reflect a realistic, credible and attractive future for the firm that makes employees really want to be part of something this is special and enhancing the possibility that they will be far more creative and engaged. One of the other major factors behind the continued success or failure of a firm is the quality of leadership at the executive level and throughout the organization.
Andersen discussed that personality characteristics are simply the only foundation for leader, and it is the unique ability to "act" that differentiates a true leader from a follower. For managers and leaders to be successful in any given situation, it is important to understand that a blend of personality, experience, capability, passion, and vision, coupled with the quality of alignment with others in the organization is necessary. One of the major factors in a company's success is the ability of key employees and managers to face reality through critical thinking, by challenging orthodoxies and looking beyond the obvious for facts that provide insights to the situation that provides deeper meaning.
The characteristics of critical thinking are normally associated with a firm's leaders, but it is asserted that a company needs to recruit and actively manage diverse people to widen the degree of critical thinking so it can be more informed about its customers, competitors, markets, stakeholders and the trends that influence their industry. One final aspect of corporate leadership that can influence the direction of a firm is its corporate governance.
Public companies have governance boards, which oversee the com pany's direction and leadership team. They are accountable to the shareholders and highly important, role in setting direction and providing oversight of a firm Corporate Governance, n. Specifically they are responsible for:. Complementary to a firm's mission and vision, every company has its real "values" that are either written or unwritten and engrained in the culture.
Values based management has become visible due to the public corporate scandals that have come to light, e. Enron,Worldcom, Tyco and Sunbeam. However, there have been other companies that, without having a corporate scandal as a catalyst, have had leaders who have properly exploited shared values and successfully molded their organizations around these values. Organizational best practices that help reinforce or even change corporate values include:. Older more established firms have long standing procedures, chosen markets, and other orthodoxies that have evolved over many years, forming part of the corporate culture.
These are rarely challenged and are simply accepted as a part of corporate life. On one hand these orthodoxies may be valuable for the firms sustainability on its current course and even considered by many as part of a companies competitive advantage.
However, they may also impede new initiatives and should be challenged for value in the context of the current vision, evolving customer needs or in the drive to move the company in a new direction.
Challenging orthodoxies and facilitating strategic thinking are especially valuable if the company is seriously looking at new growth opportunities, beyond simply leveraging its existing product development infrastructure. To facilitate effective strategic thinking, the executive leadership team really needs to view the company as a set of core competences instead of business units with an individual market focus.
They should focus on finding new opportunities and leveraging these core competences. Many companies still build their organizations based on a traditional hierarchical departmental model, which facilitates very tight control of the various functional units and can be applied geographically, by product line division or simply by function. This model works best when firms have more predictable, mechanistic business processes and the roles and responsibilities of each department are clear and well defined Learning Objectives for Organization Design, n.
However, in a hierarchy, organization groups will often attempt to maximize output in order to meet or exceed defined metrics, especially when they are directly tied into financial rewards or future opportunities for growth or individual promotion.
In this organizational design model there are no explicit incentives for people to work well together. Where the hierarchical model breaks down is when collaboration is fundamentally necessary to achieve common goals. For either type of team to be effective, they should be composed of individuals skilled in their own functional areas and who possess a high degree of mutual respect within the team environment.
Therefore, to achieve effective cross-functional collaboration it is important to have goal alignment. This can be taken to an even higher level when a mutually successful working partnership has been established with external customers as this allows inter-company teams to collaborate more closely and co-develop new more innovative products together. These new models of organizational design that facilitate innovation and learning require a collaborative sprit to be fully engrained in the culture and systems and are fundamental for both companies to build or sustain a competitive advantage.
One of the key differences in these new organizations is that market and industry analysis becomes the responsibility of people across the organization, not just a select few. Once the value of new opportunities is acknowledged, the realignment process kicks in and resources are rapidly shifted to meet those new challenges.
In the case of the networked structure, product development groups in different organizations come together to create solutions that exploit the expertise of the individual groups and so have higher intrinsic value to the end customer. It is essential that the leadership teams focus on also creating a culture that is receptive to change.
Another major consideration in modern organizational design, which impacts a firm's long-term strategy, is globalization.
As the pace of globalization continues to increase, firms need to look aggressively for any new opportunities around the world which can augment or even extend the firm's resources or capabilities, e. New geographical locations for expansion continue to become attractive as some of the following entry barriers continue to be overcome:. Extending a firm's business into another country is not easy if there is no solid base to build upon.
It requires significant investment in building and supporting the remote operation as well as everyday managerial challenges that can be significant if the team is not well aligned to the needs of the parent organization. This is especially true with small company acquisitions, which already had their own cultural identity.
Given this challenge, there are some key issues that must be considered when considering extending the company into another country or remote location, including:. Are there are any local customs, religious or other needs from the remote team? A firm needs to develop effective strategies in order to grow and be profitable. The strategic planning process is a systemic value creation process that companies should follow to select the most worthwhile strategies that will allow them to deliver on a stated mission and ultimately a high level vision.
This strategy requires that firms move away from incremental, tactical thinking and be willing to open new possibilities, specifically: a concerted effort to see the "Bigger Picture" by everyone in the firm, envision many future possibilities and directions, spend the time sorting through vast amounts of data to filter strategic information, seeing patterns, trends and relationships between disparate data, constantly evaluating divergent courses of action for the firm.
Due to the rapid pace of change, one of the key elements of this new model is continuous scanning of industries, technologies and potential markets to select and filter divergent ideas as shown in Fig 3.
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In commerce , supply chain management SCM , the management of the flow of goods and services,  involves the movement and storage of raw materials , of work-in-process inventory , and of finished goods as well as end to end order fulfilment from point of origin to point of consumption. Interconnected, interrelated or interlinked networks, channels and node businesses combine in the provision of products and services required by end customers in a supply chain. SCM encompasses the integrated planning and execution of processes required to optimize the flow of materials, information and capital in functions that broadly include demand planning, sourcing, production, inventory management and logistics -- or storage and transportation. Although it has the same goals as supply chain engineering , supply chain management is focused on a more traditional management and business based approach, whereas supply chain engineering is focused on a mathematical model based one. An example of these conflicts is the interrelation between the sale department desiring to have higher inventory levels to fulfill demands and the warehouse for which lower inventories are desired to reduce holding costs.
Strategic SCM is: The foundation of business model That drives corporate strategy architecture By aligning and pooling resources, processes, structures and systems Throughout the supply chain network It has evolved from an emphasis on integrating logistics and lowering of costs to provide better products and services to customers on real time basis and cost efficient manner. SCM in Value Chain Perspectives SCM recognised as core competency to gain sustainable competitive advantage firms ability to differentiate itself from others Value Chain disaggregates a firm into its strategically relevant activities in order to: Understand. SCM integrates value chains of all business partners and synchronizes their value adding processes for the speedier flow of: Goods Cash Value Related. Value Flow: Value is the difference between the perceived benefits from a product or service and the cost of acquisition in the eyes of the customer Quality-Cost-Quick. Goods Flow: The flow of goods is always in the forward direction, ensuring better customer service, superior value, greater market dominance and higher market share. Cash Flow: Happens in the backward direction to keep the total business system alive and activated. It involves money paid for goods and services received by supply chain member from preceeding link Information Flow: Happens in both directionfor activation and improvement of SCM.
A strategic plan is a framework or series of guideposts that keeps an operating plan on the right path to meeting objectives. A comprehensive logistics strategy should encompass strategic, operational and tactical levels of logistical planning as well as the four main pain points in the supply chain, including facility locations, customer service levels and inventory and transportation decision-making. The primary objective of any logistics strategy is to deliver the right products to the right customers at the right time and at the least possible cost. An effective logistics strategy can help your company minimize investments and other costs by defining the service levels at which your organization is most cost-effective.
Building a Sustainable Competitive Advantage. College of Business. University of Mary Washington. Fredericksburg, VA San Francisco, CA
January 4, By mhugos. Zara changes its clothing designs every two weeks on average, while competitors change their designs every two or three months. It carries about 11, distinct items per year in thousands of stores worldwide compared to competitors that carry 2, to 4, items per year in their stores.
Его тело расслабилось, он представил себе, как вручает кольцо сияющему заместителю директора АНБ. А потом они со Сьюзан будут лежать в кровати с балдахином в Стоун-Мэнор и наверстывать упущенное время.
Затем облокотился о плиту, поправил широкие серые брюки и крахмальную рубашку. - И долго ты собираешься здесь сидеть. - Всю ночь, - безучастно ответила Сьюзан. - Хм-м… - пробурчал Хейл с набитым ртом. - Милая ночка вдвоем в Детском манеже. - Втроем, - поправила Сьюзан. - Коммандер Стратмор у .
Что это. Стратмор вздохнул: - Двадцать лет назад никто не мог себе представить, что мы научимся взламывать ключи объемом в двенадцать бит. Но технология не стоит на месте.
А что, если этот парень способен ему помочь. - Прошу прощения, - сказал. - Я не расслышал, как тебя зовут. - Двухцветный, - прошипел панк, словно вынося приговор. - Двухцветный? - изумился Беккер. - Попробую отгадать… из-за прически.
Это был Чатрукьян. Он снова постучал. У него был такой вид, будто он только что увидел Армагеддон. Хейл сердито посмотрел на обезумевшего сотрудника лаборатории систем безопасности и обратился к Сьюзан: - Я сейчас вернусь. Выпей воды. Ты очень бледна.
- Не волнуйтесь, он ни слова не понимает по-испански. Беккер нахмурился. Он вспомнил кровоподтеки на груди Танкадо. - Искусственное дыхание делали санитары. - Понятия не имею. Я уже говорила, что мы ушли до их прибытия. - Вы хотите сказать - после того как стащили кольцо.
Подобно крови, бегущей по жилам старого квартала Санта-Крус, они устремлялись к сердцу народа, его истории, к своему Богу, своему собору и алтарю.
И в следующее мгновение не осталось ничего, кроме черной бездны. ГЛАВА 102 Стратмор спустился на нижний этаж ТРАНСТЕКСТА и ступил с лесов в дюймовый слой воды на полу. Гигантский компьютер содрогался мелкой дрожью, из густого клубящегося тумана падали капли воды.
- Мистер Беккер, пожалуйста, продиктуйте надпись.
Тогда Стратмор понял, что Грег Хейл должен умереть. В ТРАНСТЕКСТЕ послышался треск, и Стратмор приступил к решению стоявшей перед ним задачи - вырубить электричество. Рубильник был расположен за фреоновыми насосами слева от тела Чатрукьяна, и Стратмор сразу же его. Ему нужно было повернуть рубильник, и тогда отключилось бы электропитание, еще остававшееся в шифровалке.
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