Chapter 3 is about Strategic Initiatives for Implementing Competitive
Advantages. This chapter introduces high-profile strategic initiatives that an
organization can undertake to help it gain competitive advantage and business
efficiencies. There are 4 strategic initiatives that
the management can use which is:-
i)
Supply Chain Management
ii)
Customer Relationship Management
iii)
Business Process Reengineering
iv)
Enterprise Resource Planning
Supply Chain
Management (SCM) is
management of information flows between and among stages in a supply chain to
maximize total supply chain effectiveness and profitability.
Four basic components of supply :-
# supply chain
strategy – the strategy for managing all the resources required to meet
customer demand for all products and services.
-for example: the company wants to sell
“tudung fareeda” , then they should find all the resources such the cloth and
the colour of cloth to fulfil the customer’s demand.
# supply chain
partners – the partners chosen to deliver finished products, raw
materials, and services including pricing, delivery, and payment processes
along with partner relationship monitoring metrics.
-
for example to make the hijab maybe some
supplier just supply the thread and another supplier can supply cloth, so that
they can combined their supplied and became a partner.
# supply chain
operation – the schedule for production activities including testing,
packaging, and preparation for delivery. Measurements for this component
include productivity and quality.
-for example to produce the product, the company should
have their own schedule to make the process of production can run smoothly.
# supply chain
logistics – the product delivery processes and elements including
orders, warehouses, carriers, defective product returns and invoicing. -this part is for all the product delivery
such the transportation and to where the product has keep.
Effective
and efficient supply chain management systems can enable an organization to:
|
Decrease
|
Organization’s Supply Chain
|
Supplier power
|
|
Buyer supplier
|
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Threat of substitute products or services
|
|
Threat of new entrants
|
Increase
|
The buyer power decrease when they have
less choices to buy a products or services. So, it can make a supplier power
increase. Then, the threat of substitute products or services and threat of new
entrants also decrease because the product that they sell is less competitors.
Customer Relationship Management (CRM) involves managing all aspects of customer’s relationship with an
organization to increase customer loyalty and retention and an organization’s
profitability.
CRM allows an organization to gain
customer’s shopping and buying behaviours to develop and implement enterprise
wide strategy.
CRM is occurs anywhere such as Aeon
shopping centre, Perodua and etc.
For example is someone has send their car to Perodua to service it, then
after finish and he already back home. Then the Perodua call him to get the
feedback from their services.
CRM allows us to communicate effectively
with each customer and understand customer product and sevice.
CRM strategy:-
According to Michael Boyd
director at Eddied Bauer, said that CRM is a business strategy to try to
optimize profitability, revenue, and satisfaction at an individual customer
level.
CRM is not just technology
, but also a strategy that an organization must embrace on an enterprise level.
CRM system also allos an
organization to treat customers as individuals, gaining important insights into
their buying preferences and behavior and leading to increase sales, greater
profitability, and higher rate of customers loyalty.
Business Process Reengineering (BPR) :-
Business process is a standardized set of activities that
accomplish a specific task, such as processing a customer’s order.
Business Process
Reengineering (BPR) is the analysis and
redesign of workflow within and between enterprises.
|
Organize around
outcome not task
|
7
PRINCIPLE
|
Treat
geographically dispersed resources as though they were centralized
|
|
Identify all the
organization’s processes and prioritize them in order of redesign urgency
|
Link parallel activities
in the workflow instead of just integrating their results.
|
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Put the decision
point where the is performed, and bulid control into the process.
|
|
Integrate
information processing work into the real work that produces the information
|
Capture
information once and at the source.
|
Finding
Opportunity Using BPR
Companies
frequently strive to improve their business processes by performing tasks
faster, cheaper, and better. A company could improve the way that it travels
the road by moving from foot to horse and then from horse to car.
Creating
values for the customers is the leading factor for instituling BPR, and
information technology often plays an important enabling role.
Pitfalls
Of BPR
One hazard
of BPR is that the company becomes a wrapped up in fighting its own demons that
it fails to keep up with its competitors in offering new products or services.
4) Enterprise Resource Planning
-ERP integrates all departments and
functions throughout an organization into a single IT system.
-ERP system helps an organization to
obtain operational efficiencies, lower costs, improve supplier and customer
relations, and increase revenues and market share.
-The heart of an ERP system is a central
database information from and feeds information into all the ERP system's
individual application components (called modules), supporting diverse business
function such as accounting, manufacturing, marketing, and human resources.
ERP System
An
enterprise resource planning system, or ERP, gives businesses an information
technology tool that combines and integrates the various information systems it
uses into one comprehensive system to manage operations. An ERP typically
includes finance and accounting, human resources, supply chain and inventory,
and manufacturing information systems. Its purpose is to facilitate the flow of
information among all departments in an organization, and manage data sharing
with outside systems, such as suppliers, business partners, clients and
regulatory agencies.
#ERP solutions were developed to deliver
automation across multiple units of an organization, to help facilitate the
manufacturing process and address issues issues such as raw materials,
inventory ,order, entry and distribution.
#ERP is the combination for all Supply
Chain Management (SCM), Customer Relationship Management (CRM), and Business
Process Reengineering (BPR).
That all for chapter 3, Thank You :)
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