Post on 05-Jan-2016
description
Chapter 3
Strategic Initiatives for Implementing Competitive
Advantages
Sears’ loyalty programs involvedcustomers passed copies of thecatalog on to friends and relatives
Sell productsthrough a catalog
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Learning Outcomes
List and describe the four basic components of supply chain management
Explain customer relationship management systems and how they can help organizations understand their customers
Summarize the importance of enterprise resource planning systems
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Three strategic initiatives: Overview
Supply chain management (SCM) Customer relationship management (CRM) Enterprise resource planning (ERP)
Trek’s IT systems increased sales by 25-30 percent
Customer places an order for a Trek bike with a storeStore (such as local sporting goods store) receives the orderStore receives the payment from the customerStore orders the bike from TrekStore sends payment to Trek
Trek orders materials from its suppliers, such as packaging material, metal, & accessoriesTrek sends payments to suppliersTrek receives materials from suppliersTrek assembles the bikeTrek ships the bike to the storeCustomer picks up the Trek bike from the store
The steps typically taken when a customer buys a bike from Trek
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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
Four basic components of SCM: Supply chain strategy – strategy for managing all
resources to meet customer demand Supply chain partners – partners throughout the supply
chain that deliver finished products, raw materials, and services.
Supply chain operation – schedule for production activities
Supply chain logistics – product delivery process
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Wal-Mart and Procter & Gamble SCM
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Effective and efficient SCM systems effect on Porter’s Five Forces Effective and efficient SCM systems can
enable an organization to: Decrease the power of its buyers Increase its own supplier power Increase switching costs to reduce the threat
of substitute products or services Create entry barriers thereby reducing the
threat of new entrants Increase efficiencies while seeking a
competitive advantage through cost leadership
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Customer Relationship Management
CRM – involves managing all aspects of a customer’s relationship with an organization to increase customer loyalty and retention and an organization's profitability
CRM is not just technology, but a strategy, process, and business goal that an organization must embrace 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 behaviors
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CRM overview
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Enterprise resource planning (ERP)
ERP integrates all departments and functions throughout an organization into a single IT system so that employees can make enterprise wide decisions by viewing enterprise wide information on all business operations
ERP’s goal – every department or functional area work together sharing common information and not be a “silo”
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Briefly explain the differences betweenSCM, CRM, and ERP
SCM systems focus specifically on suppliers
CRM systems focus specifically on customers
ERP systems focus on everything, all processes, departments, and operations for an enterprise
Organizations typically operate by
functional areas or functional silos
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Enterprise resource planning (ERP)
Organizations use many integration tools to integrate IT infrastructures including: Intranets – an internalized portion of the
Internet, protected from outside access, that allows an organization to provide access to information and application software to only its employees
Enterprise information portals (EIPs) – an Internet site owned and operated by an organization to support its operations.
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ERP Vendors
Large ERP vendors include SAP PeopleSoft Oracle
Most ERP solutions include SCM and CRM components
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How Levi’s Got Its Jeans into Wal-Mart
Which of Porter’s Five Forces did Levi’s address through the implementation of its updated supply chain management system?
Evaluate how Levi’s can gain business intelligence through the implementation of a customer relationship management system
Create an argument against the following statement: “Levi’s should not invest any resources to upgrade its current supply chain management system”
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CASE QUESTIONS
Explain how implementing a CRM system enabled Saab to gain a competitive advantage
Estimate the potential impact to Saab’s business if it had not implemented a CRM system
What additional benefits could Saab receive from implementing a supply chain management system?