Strategy is the first of two critical components of any operational supply chain. If the overarching strategy is incorrect, the anticipated operational & financial results will not be produced. For those business partners who require the review, development, or deployment of a supply chain strategy that is aligned with their business strategy, our approach is the perfect solution. A key differentiator of The Supply Chain Center is the purpose of our strategy. We see very little value in helping our business partners simply ‘maintain’ their current position. Our goal is to help them become market leaders in their defined market. 

Value Discipline.

Customers buy value. Their approach to buying value from you can take the form of cost, technology, or service. The Supply Chain Center looks at this spectrum and helps business partners focus on the Value Discipline most appropriate to their customers. The most important thing to remember is that you should not try to be all things to all customers. To do so risks diluting your profitability and placing unnecessary stress on critical business functions. We help you focus on profitable customers who will see your ‘solution’ to their needs as the most superior in the marketplace.

There are some customers who see value only as cost. Customers with a focus on cost will migrate to the low cost provider who presents the least inconvenience, regardless of the nature of the product (custom or commodity). This relates to the Value Discipline of Best Total Cost provider. To be successful in this Value Discipline, companies must have sufficient scale to continuously provide their customers with the lowest cost product and make it very easy or convenient to purchase the product.

Market leaders who follow the Value Discipline of Best Total Cost have a laser-clear objective of retaining their customer base, increasing market share, and building a strong market position. Adjacent markets are somewhat important and they view adding new lines of business as a less important strategy.  

Some customers see value in the best technology or product. These customers either want or require the latest and greatest technology or product on the market. Cost is not their primary consideration, although they will make some spot comparisons. These customers look for companies who excel at the Value Discipline of Best Total Product. Companies with this Value Discipline are continually innovating and developing the next generation of products that, very often, their customers don’t even know they need yet. 

Market leaders with the Best Total Product Value Discipline have different needs and approaches. To them, adding new lines of business, increasing market share, and a strong market position are critical. They see retention of their base as important but they do not seek growth into adjacent markets. 

Other customers look for the Best Total Solution that meets their overall needs. These customers thrive on the highest levels of customer service, customized solutions, and close contact. They are not price sensitive or concerned about the latest & greatest technology because they are looking for a customized solution that meets their specific needs. Base retention is critical to companies who follow this discipline since the investment in attracting these very loyal customers is high. To keep these customers, be prepared to have market leading customer service and forgo ‘one size fits all’ marketing. 

Companies who focus on one of these three Value Disciplines, and maintain at par with the marketplace in the other two, have consistently outperformed their competition. It takes much more than selecting a Value Discipline and ‘making it happen’ to be successful. Each one has a specific Operating Model that supports, nurtures, and confirms all of the enabling factors necessary to build a market leading company. The associated Operating Models are depicted in the graph below.

Value Discipline Operating Model Best Total Cost Operational Excellence Best Total Product Technology Innovation Best Total Solution Customer Intimacy

The Supply Chain Center helps business partners Assess their current situation to determine the alignment of their current Value Discipline with the correct Operating Model. We evaluate your Core Processes, Business Structure, Management Systems, and Technology to ensure that they are optimized to meet your objectives. We also assist with the detailed Planning necessary to either develop or improve the business and supply chain strategy that is right for you. Additionally, we can aid in deploying the strategy throughout your organization so that the results you expect can be attained. 

Our Strategy sessions can be undertaken independent of operational implementation or as a convenient first step to a complete supply chain enhancement. We give our business partners the latitude to customize our approach to meet their specific needs so they attain the highest and best use from our Strategy expertise.