Measuring Performance In Supply Chain
...measurements and the relationships of the basic types of measurements to the
key logistic processes in the supply chain. Such a model could help inform the
academic and practitioner of the interrelationships of processes and
performance.
Start with Strategy
Environment is important to strategy formation. Some scholars believe that
strategies must be constrained by, and must react to, ever-changing
environmental conditions. Other scholars maintain that strategy can enact the
environment, and that the deliberate selection from available strategic choices
shapes the emergent environment (Miles and Snow 1978). In either case, there
is universal agreement that strategy selection and articulation are fundamental to
setting direction and objectives for the firm.
Figure : Measurement Within the Firm : Strategy Comes First
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Porter (1980) presented an approach to strategy, combined with a tool-kit for
practitioners. He described five forces that drive industry competition: potential
entrants, suppliers, buyers, industry competitors, and substitutes. He reported
entry barriers to be scale, differentiation, capacity requirements, switching costs,
distribution channel access, raw material access, government policy, and
relations. He described exit barriers as being economic, strategic, and emotional.
All these factors should be considered in evaluating strategic choices. He
imparted three generic strategic for competition: low-cost, differentiation, and
focus. He warned firms about getting “stuck in the middle” with a halfhearted mix
of options, not emphasizing one of the three strategies. He stated that the
strategic choices cannot be pursued simultaneously, but they can be pursued
sequentially, as opportunities dictate. Porter described four diagnostic
components to developing strategy: future goals that drive it, current strategy (or
what...
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