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LOGISTICS STRATEGY
Important!
You need the topics of this reading for the development of English Activity No. 1, which is
about the blog you have to realize in this guide.
Each company has purposes or reasons
for its existence. The mission permits
to know the purposes of the company
and its direction. It creates the strategies to get to the end of its mission.
Mission
According to Heizer and Render (2009),
economic success is the result of identifying missions to satisfy a customers
needs and wants. Mission statements
provide horizons and focus on concepts to follow in the company processes. To establish a company, strategy is
required to have a well- defined mission. If a company establishes the company rationales, the functional areas can
support the company. Functional areas
are Marketing, Finance/accounting, and
production/operations. There are also
missions for each function to support
the firms overall mission.
(refer to Table 1).
According to the author, the implementation of a Logistics Strategy in a company permits to identify the
impact of imminent changes in the supply chain and
make organizational or functional changes to ensure
service levels in the corporation.These strategies exploit opportunities and strengths, neutralize threats,
and avoid weaknesses.
Murray expresses that a company can start to develop a logistics strategy by looking at four distinct
levels of their logistics organization.
Strategic: the company needs to check its objectives and strategic supply chain decisions to see its
procedures and how they contribute to develop the
companys targets.
Structural: the logistics strategy needs to examine the
logistics company organization such as the optimum
number of warehouses and distribution centers or
products to be produced at a specific manufacturing
plant.
Functional: the company checks separate functions in
the logistics organization to achieve functional excellence in the whole organization.
Implementation: each logistics strategy requires to
be implemented across the organization. It is necessary to create a plan to implement, develop and es-
Table 2. Areas for evaluation
Multidomestic Strategy
The multidomestic strategy has decentralized authority with significant autonomy at each business. Organizationally, these are subsidiaries, franchises, or joint
ventures with substantial independence. The advantage
of this strategy is maximizing a competitive response
for the local market; however, the strategy has little or
no cost advantage.
Global Strategy
A global strategy has a high degree of centralization,
with headquarters coordinating the organization to
search standardization and learning between plants and
generating economies of scale. This strategy is correct
when the strategic focus is cost reduction but its local
responsiveness is high.
Transnational Strategy
A transnational strategy exploits the economies of scale and learning. However, they are under nation pressure for responsiveness and responsibility in each part of
the organization. Transnational describes a condition in
which material, people and ideas cross or transgressnational boundaries. These firms have the potential to
pursue all three operations strategies (i.e., differentiation, low cost, and response).
References
Heizer, J., & Render, B. (2009). Operations strategy in a global environment.
In Pearson Prentice Hall, Operations Management (pp. 25-49). New Jersey: Pearson Education, Inc.
International Strategy
An international strategy uses exports and licenses to
penetrate in the global world. It doesnt take advantage
from the local markets and has little local responsiveness and little cost advantage. It has little responsiveness because companies export or license goods from
the home country. Cost advantages are few because
companies use production process at some distance
from the new market. However, an international strategy is easy because exports can require little change in
existing operations, and licensing agreements.
Dear apprentices:
After studing this document, we invite
you to answer the questionnaire of
evidence section.