CHAPTER 3: STRATEGIC INITIATIVES FOR IMPLEMENTING COMPETITIVE ADVANTAGES SUPPLY CHAIN MANAGEMENT

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. The four basic components of supply chain management are:

1. Supply chain strategy - the strategy for managing all the resources required to meet customer demand for all products and services.
2. 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.
3. Supply chain operation - the schedule for production activities including testing, packaging and preparation for delivery. Measurements for this component include productivity and quality.
4. Supply chain logistics - the product delivery processes and elements including orders, warehouse, carriers, defective product returns, and invoicing.  

Effective and Efficient Supply Chain Management's Effect on Porter's Five Forces

Effective and efficient supply chain management systems can enable an organization to:

• Decrease the power of its buyers.
• Increase it’s 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 efficiency while seeking a competitive advantage through cost leadership.

Customer Relationship Management

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 overview

Based on the figure, it’s provides an overview of a typical CRM system. Customers contact an organization through various means including call centers, web access, email, faxes, and direct sales. A single customer may access an organization multiple times through many different channels. The CRM system tracks every communication between the customer and the organization and provides access to CRM information within different systems from accounting to order fulfillment. Understanding all customer communications allows the organizations to communicate effectively with each customer.

CRM Strategy

It is important to realize that CRM is not just technology, but also a strategy that an organization must embrace on an enterprise level. Although there are many technological components of CRM, it is actually a process and business goal simply enhanced by technology. Implementing a CRM system can help an organization identify customers and design specific marketing campaigns tailored to each customer, thereby increasing customer spending. A CRM system also allows an organization to treat customers as individuals, gaining important insights into their buying preferences and behaviors and leading to increased sales, greater profitability and higher rate of customer loyalty.

Business Process Re-engineering

A business process is a standardized set of activities that accomplish a specific task, such as processing a customer's order. Business process re-engineering (BPR) is the analysis and redesigns of workflow within and between enterprises. The concept of BPR traces its origins to management theories developed as early as the 19th century. The purpose of BPR is to make all business process the best-in-class.

Seven Principles of Business Process Re-engineering

Finding Opportunity Using BPR

Companies frequently strive to improve their business processes by performing tasks faster, cheaper, and better.

Better, Faster, Cheaper of BPR

Based on the figure that displays different ways to travel the same road.  A company could improve the way that it travels the road by moving from foot to horse and then from horse to car. However, true BPR would look at taking different path. A company could forget about traveling on the same old road and use an airplane to get to its final destination. Companies often follow the same indirect path for doing business, not realizing there might be a different, faster and more direct way of doing business.

Pitfalls of BPR 

One hazard of BPR is that the company becomes so wrapped up in fighting its own demons that it fails to keep up with its competitors in offering new products or services. While American Express tackled a comprehensive re-engineering of its credit card business, MasterCard and Visa introduced a new product- the corporate procurement card. American Express lagged a full year behind before offering its customers the same service.

Enterprise Resource Planning

Today's business leaders need significant amounts of information to be readily accessible with real-time views into their businesses so that decisions can be made when they need to be, without the added time of tracking data and generating reports. Enterprise resource planning (ERP) integrates all departments and functions throughout an organization into a single IT system so that employees can make decisions by viewing enterprise-wide information on all business operations.

Auto Insurance Claims Processes

THANK YOU !!

CHAPTER 2 – IDENTIFYING COMPETITIVE ADVANTAGE

Introduction

What is competitive advantage?

Ø  A product or services that an organization’s customers place a greater value on than similar offerings from a competition.

Ø  Unfortunately, CA is temporary because competitors keep duplicate the strategy.

Ø  Then, the company should start the new competitive advantages

Michael Porter’s Five Forces Model is useful tool to aid organization in challenging decision whether to join a new industry or industry segment

-              Buyer Power

Ø  High – when buyers have many choices of whom to buy

Ø  Low – when their choices are few

Ø  To reduce buyer power (and create competitive advantage), an organization must make it more attractive to buy from the company not from the competitors

Ø  Best practices of IT based

§  Loyalty program in travel industry, for example rewards on free airline tickets or hotel stays

THE COMPETITIVE ENVIRONMENT

Bargaining Power of Customers/Buyer Power

§  Customers can grow large and powerful as a result of their market share

§  Many choices of whom to buy from

§  Low when comes to limited items

§  Example, used loyalty programs (Jusco card, Tesco card, being a members to get the discount)

2.       Supplier Power

Ø  High – when buyers have few choices of whom to buy from

Ø  Low – when their choices are many

Ø  Best practices of IT to create competitive advantage

Ø  Example, B2B marketplace – private exchange allow a single buyer to posts it needs and then open the bidding to any supplier who would care to bid. Reverse auction is an auction format in which increasingly lower bids

An organization within the Supply Chain

.. Supplier power is the converse of buyer power

1.       Threat of Substitute products and services

v  High – when there are many alternatives to a product or service

v  Low – when there are few alternatives from which to choose

v   Ideally, an organization would like to be on a market in which there are few substitutes of their product or services

v  Best practices of IT

v  Example, Electronic product – same functions different brands

THE COMPETITIVE ENVIRONMENT

Threat of Substitutes

-       To the extent that customers can use different products to fulfill the same need, the threat of substitutes exists

-       Example, electrical product – same function different brands

-       Switching cost – costs can make customer reluctant to switch to another product or service

2.       Threat of new entrants

·         High – when it is easy for new competitors to enter a market

·         Low – when there are significant entry barriers to entering a market

·         Entry barriers is a product or service feature that customers have come to except from organizations and must be offered by entering organization to complete and survive

·          Best practices of IT

·         Example, new bank must offers online paying bills, acc. monitoring to compete

THE COMPETITIVE ENVIRONMENT

Threat of New Entrants

-       Many threats come from companies that do not yet exist or have a presence in a given industry or market

-       The threat of new entrants forces top management to monitor the trends, especially in technology, that might give rise to new competitors

-       Example, new bank (online paying bills, acc. monitoring)

3.  Rivalry among existence competitors

·         High – when competition is fierce in a market

·         Low – when competition is more complacent

·         Best practices of IT

·         Wal-Mart and its suppliers using IT – enabled system for communication and track product at aisles by effective tagging system

·         Reduce cost by using effective supply chain

THE COMPETITIVE ENVIRONMENT

Rivalry among Existing Firms

•   Existing competitors are not much of the threat: typically each firm has found its “niche”.
• However, changes in management, ownership, or “the rules of the game” can give rise to serious threats to long term survival from existing firms
•   Example, the airline industry faces serious threats from airlines operating in bankruptcy, who do not the debts while slashing fares against those healthy airlines who do pay on debt. (MAS & AIR ASIA)

The Value Chains – Targeting Business Processes

Supply Chain – a chain or series of processes that adds value to product and service for customer

 Add value to its products and services that support a profit margin for the firm

CHAPTER 1 BUSINESS DRIVEN TECHNOLOGY

Assalamualaikum friends,

For semester 4 in Business Insurance we studies MGT 300

In chapter 1, Madam Intan taught about Business Driven Technology💻

Firstly , Madam Intan talk about⇨

🔀Information Technology's Role in Business (IT)

IT is everywhere🔄 in business such as:

  Keeping Database

   •Email and communication

   •Replacing human labour

   •Scalability

In our daily life, we also used IT such as Whatsapps, Facebook, Twitter, Blog, Instagram and so on where we got an info from people.

 🔀Information Technology's Impact on Business Operations

~Organizations typically operate by functional areas or functional silos

~Functional areas are interdependent

.......................................................................................................................................................................................................................................

IT Project Goals such as:

1⃣ Reduce costs / Improve productivity

2⃣ Improve customer satisfaction / loyalty

3⃣ Create competitive advantage

4⃣ Generate growth

5⃣ Streamline supply chain

6⃣ Global expansion

Information Technology  Basics:

Information Technology (IT)

A field concerned with the use of technology in managing and processing information. Information technology are important enabler of business success and innovation.

Management Information Systems (MIS)

General name for the business function and academic discipline covering the application of people for technologies, procedures to solving problems, jobs and so on. MIS is business function, similar to Accounting, Finance, Operations and Human Resources.

When the beginning to learn about IT it's important to understand:

What is a Data?

What about Information?

What means business intelligence?

What types of IT cultures?

Data is raw fact that describe the characteristics of an event.

Information is data converted into a meaningful and useful context

Business intelligence means application and technologies that are used to support decision-making effort.

Before talk about types of IT cultures, there are have IT RESOURCES.

- People use 

- IT technology to work with

- Information 

There are 4 types of IT Cultures ;-

Information-Functional Culture 

Employees use information as means of exercising influence or power over others. For example, a manager in sales refuses to share info with marketing. This causes marketing to need the sales manager's input each time a new sales strategy is developed.

Information-Sharing Culture.

Employees across departments trust each other to use information (especially about problems and failures for instance) to improve performance.

Information-Inquiring Culture

Employees across departments search for information to understand the future and align themselves with the current trends and new directions.

Information-Discovery Culture

Employees across departments are open to new insights about crisis and radical changes and seek ways to create competitive advantages.

If you enjoyed this post, I would like to story-mory about another chapter. Wait and see yaahh!!!! See you soon

♛~

Intro lah apa lagi kan macam la tak biasa✌ Nama shahira (cliche kan?) hahaha. Just call me CikRaa. Why? Senang nak ingat kot. Study dekat Universiti Teknologi Mara Melaka. Kenapa pilih Uitm? Sebab dia universiti kot, tak sama dengan lain macam poli, kolej (Pikir pendek)Nama je asal Kluang, Johor tapi susah benor nak balik minggu. Save bajet!Kat uni banyak nak pakai duit. Bukunya lagi, potostate nya lagi belom part print nya. Hah!! kira lah berapa kos dia. Makan takmasuk lagi. Aktiviti club lagi. Makaihhh Sebab tuh digalakkan kerja before korang sambung belajar. First masuk uni/kolej/poli ke memang banyak pakai duit. Kalau rasa rasa dah ada niat nak sambung belajar, prepare awalAmbil course Business Insurance. Kau fikir senang???Fuhh perah otak nak study, time final pun tak tidur sebab takut takdapat score. Tapi alhamdulillah lulus semua subject. Sekarang dah part 4, so1 sem jeh lagiFikir senang? Berangan ni macam dah nak graduate. Hehehehe✌Nak berjaya berdoa , usaha, tawakal IN SHA ALLAH! Dengan keberkatan ibu bapa, kawan kawan, lecturers dan terutama Allah, kita boleh berjaya meraih keputusan yang cemerlang dan terbaik Tutuplah tirai celoteh CikRaa ni. Nanti kita jumpa lagi.

Bye Assalamualaikum & Selamat Maju Jaya In sha Allah