supply chain

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I am in need of help with an assignment that involves global logistics and risk management within the supply chain. I have attached the assignment criteria, rubric, and the reading that covers the assignment. if you have any questions or concerns please let me know.

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Assignment 3: Scenario (Week 5)
Instructions
This week we reviewed global logistics, risk management, and the product and supply chains. Identify
and describe the global market forces, risks, development chain, supply chain, and strategies from one of
the following perspectives.
•
Supplier
•
Manufacturer
•
Retailer
•
Customer
•
Decision Maker
•
750 – 1,000 words (3 – 4 pages) written essay
•
APA format required (including title page, reference page – no abstract required)
•
5 – 7 academic resources for 300/400 level courses
Content of paper should address the concepts covered this week utilizing personal experience as
well as research
5
Developments in
Organizational
Performance through
Strategic Supply Chain
Collaboration
Simon A. Burtonshaw-Gunn and Malik G. Salameh
Copyright © 2011. J. Ross Publishing. All rights reserved.
Introduction
As marketplaces are increasingly competitive and the rate of innovation continues
to increase there is a need to manage growing complexity as companies widen their
influence by looking at international supply chain management to gain a competitive
advantage. While this is likely to cover the provision of goods or components, at the
more strategic level the integration of an organization’s people supported by the right
corporate culture allows technology to capture and manage raw data and information
at an unprecedented rate. Clearly, organizations have to recognize, respond to, and
satisfy the requirements of their customers if they intend to stay in business and benefit from future growth through repeat business. In support of this corporate objective,
supply chain management (SCM) has, for many companies, developed from the older
function of purchasing to now embrace planning, implementing, and controlling all
of the suppliers to the organization with a view to delivering a more integrated service
to its customers. However, with a greater realization of the global economy a number
53
Zsidisin, G., & Khan, O. (2011). Handbook for supply chain risk management : Case studies, effective practices and emerging
trends. J. Ross Publishing.
Created from apus on 2023-12-16 00:09:21.
Copyright © 2011. J. Ross Publishing. All rights reserved.
54   Handbook for Supply Chain Risk Management
of organizations are unable to compete by using solely their own resources and have
to look for alternatives to gain a competitive advantage.
For many companies, both products and services have increased in their complexity and value, and as such, pursuing new business opportunities often involve
accepting a greater level of risk. The inevitable consequence of such competitive
pressures is to pursue high-risk business and winning opportunities by the formation of partnerships, especially when circumstances are surrounded by high levels
of uncertainty. Examples of this are seen in the European aviation sector where a
number of international partners design, develop, and manufacture major component
assemblies for a complete aircraft with no one company, or indeed, one nation able to
afford the development costs alone. For large organizations in particular, the attraction may be to form a strategic alliance or joint venture, providing organizational
performance advantages to all parties through the development and realization of
business synergy.
One form of strategic alliance, usually resulting in the formation of a new company, is a merger between two willing organizations that are usually developed from
resource constraints among one or several of the cooperating entities. An example
of this was the merger between Marconi Defense Systems and British Aerospace in
1999 with the formation of BAE Systems for the defense market. Typically, this type
of alliance occurs when funding is needed to capitalize on a company’s technological opportunity, or alliances are formed in order to reduce barriers to market entry;
the latter is often synonymous with exploring new international markets. It should
be noted that this type of alliance is formal and should only be considered when the
parties concerned have a good working knowledge of each other, share a number of
cultural synergies, and are prepared to give the new organization their full commitment, both financially and managerially.
Instead of forming a new special purpose company (SPC) or joint venture, an
alternative approach is for organizations to develop their capabilities to be able to
meet the requirements of current and future customers. Then, they can provide benefits from working closer within their respective supplier base.
This chapter uses a case study that identifies and reviews the potential risks and
opportunities that the international company Blue Sky Aviation encountered in trying to enter the Chinese aviation supply chain market with a special focus on the
acquisition and realization of airport prime contracts. While recent developments
have encouraged Western companies to operate in China, at the time of this study
the Chinese aviation sector was a difficult market to address because of a number of
technical, financial, and social reasons, often resulting in multinational companies in
various sectors having little success in terms of market penetration. Moreover, where
this commitment had proved rewarding, it had required a long-term business strategy
to gain a valued long-term return. Intrinsic to success in this example was the selection of the correct Chinese partners to provide necessary guidance and assistance,
and helping to overcome bureaucratic and cultural hurdles. The case study discusses
a series of high-level strategic options that were considered by Blue Sky Aviation in
Zsidisin, G., & Khan, O. (2011). Handbook for supply chain risk management : Case studies, effective practices and emerging
trends. J. Ross Publishing.
Created from apus on 2023-12-16 00:09:21.
Developments in Organizational Performance   55
establishing a stronger presence in the Chinese aviation market through strategic
collaboration.
Blue Sky Aviation’s business vision was to develop stronger political, commercial,
and industrial relations in China to support and best position itself to secure contracts
in civil aviation and, in a longer timeframe, in defense sectors when European defense
trading restrictions were removed. In the short term, as a preferred industrial partner,
contracts would be confined to civil aviation or non-contentious defense equipment,
with a medium term focus on a commercialization route for the funding of Chinese
airports. The long-term strategy concentrated on positioning the company for the
emergent opportunities that would arise once the Chinese market became available to
Western defense companies.
The company had a number of existing contracts within the Chinese aviation market, which had previously afforded the company a certain level of market
presence. However, the contracts had in some cases been to the detriment of the
company’s credibility and corporate profile. Indeed, the company had established a
reputation for the manufacture of major aircraft components under license in China,
but these contracts had failed to realize the business growth potential, value, or profitability expected. It should be noted that while this chapter reports on actual business
considerations, the company name has been changed and some aspects have been
omitted for reasons of confidentiality.
Copyright © 2011. J. Ross Publishing. All rights reserved.
Understanding the Indigenous Airport Market
and Operational Environment
For both economic and political reasons, air travel in China until thirty years ago was
rare, with only one airline and both the airports and airspace being controlled by the
military. As a result of Opening Up policies, an increasing part of the airspace had been
gradually given over to civilian use or transferred to dual usage. The larger airports
dominated in terms of passengers handled with the five largest airports by passengers
believed to account for about half of all domestic passengers, and with international
passengers also highly concentrated. Airport development was one of China’s top priorities, and foreign direct investment often took the form of ownership of a particular
service function such as ground handling or catering.
To assist Blue Sky Aviation’s understanding, a detailed market analysis was undertaken of the commercial airports in China, identifying 254 airport projects, of which
143 were fully operational civilian airports, with the remainder encompassing dual
purpose military and civil usage, purely military usage, or future proposed airport
developments. Factors such as capacity constraints, passenger throughput, and demographic criteria had been considered when selecting target airports as supply chain
partnership prospects. This research identified key differences between China and the
UK in regards to an airport’s status and how it functioned, as shown in Table 5.1.
Zsidisin, G., & Khan, O. (2011). Handbook for supply chain risk management : Case studies, effective practices and emerging
trends. J. Ross Publishing.
Created from apus on 2023-12-16 00:09:21.
56   Handbook for Supply Chain Risk Management
Copyright © 2011. J. Ross Publishing. All rights reserved.
Table 5.1 ​Market analysis of airports in China versus UK
Market finding . . .
Meaning that . . . .
An airport in China has a much higher
status than in the UK and is held in
much greater esteem.
In China, the airport is seen as the window of a
city or the country.
An airport in China has much more
control over its development than a UK
airport.
In the UK, community and environmental pressure
can delay or stop airport developments.
When an airport was developed in
China, there was often no pressure to
prove that it would be profitable.
An airport in China is often being built as a political symbol of local and national pride, not a market requirement.
Airport management structures are very
different.
In China, every person working on the site is an
employee of the airport and under tight management control.
Airports in China provide social services.
An airport often provides residential accommodations for employees, and operates schools,
hospitals, cinemas, and pension systems on their
behalf.
Civil aviation authorities in China have
much more power than in the UK.
Authorities in China control air transport policy
and run many institutions, including universities
and research institutes.
Airports in China were facing fierce
restructuring at the time of the study.
Consolidation into different airport groups—with
an initiative to place airports in the hands of the
local government.
A high level strategic analysis of the aviation sector in China using a SWOT
(strengths, weaknesses, opportunities, and threats) format was undertaken and is
presented in Table 5.2.
As a consequence of the market understanding, a set of corporate business objectives for securing significant business over a ten-year period was developed with the
intention of growing the business in a low risk way through tactical market positioning opportunities. Penetrating this market at a prime contract level from the outset
was considered to be high risk, and exceedingly onerous because of the time-scale
for projects (often taking a number of years to win a contract in China) and the significant investment implications. By acting as a support organization, it was felt that
this would prove far less restrictive in terms of barriers to market entry, also enabling
Blue Sky Aviation to offer professional advice in the early planning stages of airport
programs in the following areas:
•
•
•
•
•
•
Formation of core prime contracting team
Recruitment of key personnel and capabilities
Supplier partnership agreements
Management processes for prime contracting
Risk management tools and protocols
Life cycle management
Zsidisin, G., & Khan, O. (2011). Handbook for supply chain risk management : Case studies, effective practices and emerging
trends. J. Ross Publishing.
Created from apus on 2023-12-16 00:09:21.
Zsidisin, G., & Khan, O. (2011). Handbook for supply chain risk management : Case studies, effective practices and emerging
trends. J. Ross Publishing.
Created from apus on 2023-12-16 00:09:21.
• ​Blue Sky’s perception that airports are noncore business by internal
stakeholders
• ​Unwillingness to fund any form of long-term business development
activity
• ​Ineffective market research, market analysis and customer analysis
through in-country presence
• ​Organization performance focused; therefore, financials need to
show short-term return
• ​Understanding of economic regulation and macro environment
including political, legal, social, cultural, technical and economic
factors
• ​No large-scale successful regional experience
• ​Credibility linked to other aviation projects
• ​Company could come under pressure to produce results because of
the high cost of being in country, making it more difficult to slowly
adapt to prevailing market conditions
• ​Joint ventures may be a suitable option in other parts of the Blue
Sky’s portfolio, even with a large equity stake in China; they can
often be an uneasy marriage
• ​Unreasonable demands from local suppliers and officials require
trust and confidence in the Chinese partner’s local expertise, to
solve these problems with joint ventures in mind
Threats
• ​Lack of high-level political support; considered essential to have the
highest level relationships
• ​Lack of inclusion in the five year planning horizon may constrain
business and market opportunities, unless business opportunity
under consideration can be shown to be critical in the five-year
development plan timeframe
• ​Company name, credibility and global status
• ​Proven core competencies in airport developments
• ​Proven prime contract management capability gained through other
international projects
• ​Company’s funding capability
• ​Risk management capability
• ​Large scale program/contract integration experience
• ​Existing partnerships
• ​Substantial expertise with JV’s and strategic alliances
• ​Balance sheet strength
• ​Blue Sky’s capability to innovate and provide strategic and tactical solutions for technically complex high value projects in difficult
markets
Opportunities
• ​Leverage for other sales/services directly or indirectly through airport prime, such as radar, aircraft, equipment, and training
• ​Build long-term strong relationships and regional presence for the
company
Continues
Weaknesses
Strengths
Table 5.2 ​SWOT analysis of aviation sector in China
Copyright © 2011. J. Ross Publishing. All rights reserved.
Developments in Organizational Performance   57
Threats
• ​Intellectual property infringements have proved taxing for all foreign
investment organizations, especially under Chinese law and in the
maintenance of harmonious JV relationships
• ​Business capture costs much higher than human capital costs
• ​Equity stake may have to be hard cash and not partially provided
through the value of human capital and knowledge (more prominent
in less developed provinces)
• ​Lack of visibility of PRC government’s latent needs, wants and
desires could restrict the success rate of securing new business
• ​Targeting airport developments outside of key metropolitan and
favored tourist areas may prove high risk as these have historically
accounted for 95% of traffic volume
• ​Acting in accordance with indigenous supply chain capabilities may
prove a hindrance because of the maturity of the systems utilized
• ​Gradual abolition of special privileges and incentives to foreign
investors in an attempt to level the playing field between foreign and
domestic companies
• ​Historical legacies such as the cradle-to-grave guarantees of
employment will have an impact on long-term business partnerships and the level of protectionism (very prominent in Civil Aviation
industry—a privileged status)
• ​Chinese dependency on political decision making
Opportunities
• ​Planned economy and five-year plan provides opportunities, both
within and external, to the plan
• ​Scale of deliverables and associated risks provide some good barriers to entry
• ​Chinese partner is key enabler to success; Blue Sky has strength to
leverage high level UK Government support
• ​CAAC (Civil Aviation Authority of China) injecting more commercialization into airport systems using private finance; to include hotels,
rail links, ground handling, concessions, cargo terminals and maintenance facilities (no equity limit applies to these airport services)
• ​Merger and consolidation amongst the top and 2nd & 3rd tier airlines respectively, due to safety or financial health reasons may provide a source for a JV partner (CAAC rationalizing member airlines
into three main groups)
• ​Much needed expertise in airport operations (including safety) not
just commercialization consultancy could provide a tactical entry
point to the Chinese market
• ​Debt-for-equity swaps may provide solutions to possible partnership issues for indebted enterprises that have good prospects and
wide networks (may require management influence from investor to
be successful)
• ​Chinese subsidiary of a foreign investment organization will allow it
to be listed on the Chinese stock exchange
Table 5.2 ​(Continued)
Copyright © 2011. J. Ross Publishing. All rights reserved.
58   Handbook for Supply Chain Risk Management
Zsidisin, G., & Khan, O. (2011). Handbook for supply chain risk management : Case studies, effective practices and emerging
trends. J. Ross Publishing.
Created from apus on 2023-12-16 00:09:21.
Developments in Organizational Performance   59
Business Analysis
On the basis of market research, a partnering value proposition was developed, covering the areas of the prime contracting arena, which Blue Sky Aviation believed it had
both the credibility and core capabilities to participate in, to develop existing and new
airports in China. This high-level prime contracting approach offered:
•
•
•
•
•
•
•
•
Airport facilities management
Airport business opportunities
Airport business community
Private Finance Initiative (PFI), Build Operate Transfer (BOT), and
Concessions
Interface between contractors and government independently
Interface and risk sharing by managing the prime contract
Contingency planning and business continuity
Integrated risk management
In examining the business strategy options, a total of 16 major factors were considered, as shown in Table 5.3.
In order to satisfy internal stakeholders and governance, it was necessary for the
company to institute a partnered support performance management system against
identified key performance indicators (KPIs), which were shared and specific to the
regional business development aspirations of supply chain partners. These included
the following:
Copyright © 2011. J. Ross Publishing. All rights reserved.
•
•
•
•
•
Financial performance
Timeframe adherence
Risk management
Delivery of offset obligations
Resource utilization and allocation
This case study provides an account of the considerations for market development
from a strategic management perspective, and in particular, highlights that even when
a partnership approach is an attractive approach, it is not without risk. Indeed, the
business strategy options presented in Table 5.3 have particular risks associated with
them, and are presented using the traditional PESTLE (political, economic, social,
technological, legal and environmental) approach:
Political
• Vulnerability of Blue Sky Aviation’s Chinese projects because of the UK government’s foreign policy guideline changes for doing business with Chinese
government agencies due to environmental or geo-political factors.
• Currently, airports generally obtain more financial support than local industries as they are funded from the Chinese Central Government. Any change
in this funding would undermine their business attractiveness.
Zsidisin, G., & Khan, O. (2011). Handbook for supply chain risk management : Case studies, effective practices and emerging
trends. J. Ross Publishing.
Created from apus on 2023-12-16 00:09:21.
Details
Partner with airline/airline group who could then purchase an airport. Large scale program/life-cycle management
contract experience essential in absorbing high business capture costs and as a financial shield against any gradual abolition of special privileges and incentives to foreign investors.
Partner with an airport that already had an equity stake in another airport. Blue Sky Aviation’s funding capability
gave it access to projects where the scale of deliverables and associated risks provide some barriers to entry for
the competition.
Partner with an airport which was likely to be taken over by an airport consortium. For the first three strategies
existing successful partnerships throughout Blue Sky Aviation’s global network would help build necessary, strong,
long-term relationships and corporate presence.
Investing in an airport function with existing evidence of foreign ownership (e.g., ground handling). Blue Sky Aviation’s
risk management capability would have assisted in appraising such investments by means of a cost/benefit analysis;
testing other areas of the supply chain as sources of opportunity.
Invest in an indebted organization—exchanging debt for equity to gain greater market presence. Blue Sky Aviation’s
substantial expertise of joint ventures and strategic alliances would have assisted with issues such as intellectual
property rights infringements. Their proven innovative and tactical solutions would help mitigate cultural and operational issues such as cradle-to-grave employment.
Set up a centralized security agency for the issuance of certificates for the transportation of dangerous goods, thus
providing for a need which would gain the company high level Chinese Government approval.
Investment in the Civil Aviation University, leveraging Blue Sky Aviation’s name, credibility, and global status, making it a good partner organization for the Civil Aviation University and helping to establish a school for airport management training.
Creation of a new business in parallel or partnership with an aircraft training organization. Blue Sky Aviation’s global
network of existing successful partnerships and strategic alliances, such as their share in an international aircraft
manufacturing program, would assist in any such joint training venture.
Investing wherever opportunities exist to include other aviation related areas or industries through pilot/pathfinder
projects. Blue Sky Aviation’s global presence and diversity of product portfolio and service provision profile would
enable it to capitalize on adjacent market opportunities outside of civil aviation to gain market presence and a
greater regional operating footprint.
Strategic Option
Airline Partner option
Airport Partner option
Airport Consortium
option
Airport Function option
Indebted organization
option
Dangerous goods
considerations
Civil Aviation University
Training organization
Wider investments
Table 5.3 ​Business strategy options
Copyright © 2011. J. Ross Publishing. All rights reserved.
60   Handbook for Supply Chain Risk Management
Zsidisin, G., & Khan, O. (2011). Handbook for supply chain risk management : Case studies, effective practices and emerging
trends. J. Ross Publishing.
Created from apus on 2023-12-16 00:09:21.
Combine Blue Sky Aviation’s capabilities in a joint venture with a recognized international airport group. This would be
an airport group that had a demonstrable track record of international airport projects and, thus, could provide them
with the necessary credibility, and skills for market entry, in conjunction with the right Chinese partner.
Support role offering strategic consultancy advice. This would give visibility and a proliferation of knowledge of the
company’s capabilities and would provide a foundation from which to build up the scale and scope of future activities within the Chinese aviation market, or by partnering a consultancy that has existing presence in China.
Utilizing Blue Sky Aviation’s wing manufacturing facility that operated under license in China as a means to access
key Chinese suppliers in such areas as construction, logistics and respective technologies—important in mitigating
unreasonable demands from the indigenous supply chain.
Identify a Chinese partner who may need greater balance sheet strength in order to grow holistically. Blue Sky
Aviation could provide the required financial strength to expedite such growth in return for market access.
This would involve establishing a new business operation in China with an appropriate Chinese partner capable of
marketing and exporting its capabilities in a third party revenue generation capacity. Furthermore, this would act as
a center for excellence in the South East Asian aviation market.
Pilot Blue Sky Aviation’s airport prime contracting capability on major internal programs, while undertaking various
strategic positioning activities, such as pure consultancy, until such time as market conditions offer the best business winning opportunities.
Blue Sky Aviation could provide a bridge for companies keen to invest in China that are otherwise prevented from
doing so due to poor political relations between the two countries. This may mean the investment represents a
lower financial risk for Blue Sky Aviation.
International airport
group partner
Consultancy advice
Manufacturing
Investing in a Chinese
partner
Third party revenue
Pilot schemes
International
consortiums
Copyright © 2011. J. Ross Publishing. All rights reserved.
Developments in Organizational Performance   61
Zsidisin, G., & Khan, O. (2011). Handbook for supply chain risk management : Case studies, effective practices and emerging
trends. J. Ross Publishing.
Created from apus on 2023-12-16 00:09:21.
62   Handbook for Supply Chain Risk Management
• The lengthy nature of the business capture cycle for the Chinese market means
that it is reliant on medium-to-long-term market forecasts that may be inaccurate and also beyond Blue Sky Aviation’s strategic planning horizons.
• Conflict of interests with the partnering organization as to where to invest and
the nature of the investment.
• Restructuring of product or service offerings may act as a catalyst in shifting focus
of core business to defense rather than commercial aerospace business streams.
Economic
• Underestimating the level of investment required due to weak due diligence
because of lack of resources or time available prior to collaboration
• Inability to leverage the requisite level of capital necessary for the upfront
investment costs involved at the infancy of an airport prime contract, either
internally or from financial markets
• Impact of financial difficulties for the indigenous partnering organization
because of domestic market conditions or governmental policy
• Downturn in business in other parts of Blue Sky Aviation portfolio leading to
a withdrawal of equity investments and business development activities in the
Chinese domestic market
• Blue Sky Aviation’s main board would withdraw corporate funding due to
corporate performance concerns, partnership restrictions, or lack of investor
confidence
• Procurement and manufacture of assets required to deliver an airport prime
contract may be negatively impacted by exchange rate fluctuations
• Insufficient contingency provision, risk allowance, and profitability exist within
this new business due to transparency concerns in commercial pricing process
Copyright © 2011. J. Ross Publishing. All rights reserved.
Social
• Resistance to change resulting from indigenous airport management having
too strong of a hold over their employees through provision of residential
accommodation for employees, and often operating schools, hospitals, cinemas, and pension systems on their behalf
• The acquisition of an airport prime contract may necessitate additional investments in order to gain approval—including airport employee housing and
schooling
• The extent of Blue Sky Aviation’s risk exposure with regard to asset management is predicated on the fact that an airport is a business with high fixed
costs, which could undermine achieving the required return
Technology
• Offset may prove to be a critical and decisive factor in securing an airport
prime contract award. However, inability to discharge such obligations may
Zsidisin, G., & Khan, O. (2011). Handbook for supply chain risk management : Case studies, effective practices and emerging
trends. J. Ross Publishing.
Created from apus on 2023-12-16 00:09:21.
Developments in Organizational Performance   63
result in the cancellation of further downstream opportunities, including
defense contracts.
• Strong Blue Sky Aviation management control applied to close a deal too
quickly at the expense of managing expectations and delivering on commitments.
Legal
• Program duration involved in long-term Chinese projects may mean that Blue
Sky Aviation could be committed to a long-term financial commitment from
which it cannot extricate itself if the wrong strategic alliance is chosen
• Prime contract organizational governance and life cycle management culture
may prove too restrictive and risk averse to approve prime contracts
• The impacts of legislative, regulatory, and environmental changes in civil
aviation internationally are likely to heavily influence programs with extended
durations—especially airport prime contracts
• Ineffective negotiation and scoping of prerequisite terms and conditions
means that the contract conditions binding Blue Sky Aviation to either a JV
partner or any form of investment vehicle may disadvantage the company
Environmental
Copyright © 2011. J. Ross Publishing. All rights reserved.
• Failure of joint venture relationship or SPC, resulting from unwanted international and regional bad press through poor media management
• Market predictions arising from feasibility studies may in some cases be
improperly ratified, and as such, present an overly optimistic picture of future
growth potential
• Blue Sky Aviation’s civil aviation plans could be frustrated midterm if the
group feels that further investment would not bring the company closer to its
desired long-term objective of a defense contract
For many organizations, managing supply chain risk is focused on the negative
impacts on a business—ranging from intangible elements, such as goodwill with
customers and suppliers, reputational and brand damage, to more easily quantifiable
consequences, such as financial losses and continuity of business operations/service
delivery. However, it is hoped that the principal benefit of this case study has been
to encourage the reader to perhaps adopt a broader perspective on supply chain risk
assessment and analysis, not limiting it to a product of the business impact versus
likelihood risk equation. As discussed, this case study can offer a perspective as a
source of business opportunity, market entry, and—if economic, political, and social
developments are effectively addressed—a potential source of competitive advantage,
as shown in Figure 5.1.
The airport prime contracting arena, because of its complexity, strategic nature,
and funding requirements, provides a good example to highlight the importance of
Zsidisin, G., & Khan, O. (2011). Handbook for supply chain risk management : Case studies, effective practices and emerging
trends. J. Ross Publishing.
Created from apus on 2023-12-16 00:09:21.
64   Handbook for Supply Chain Risk Management
Environmental impact
Supply chain
PSP
Community impact
Airport
SLA
SLAs
Prime
KPI
KPIs
Contract
Those who benefit from
service, in turn benefit the
global organization
Offset obligations
Risk management
Cultural awareness
Copyright © 2011. J. Ross Publishing. All rights reserved.
Figure 5.1 ​Strategic considerations and outputs.
reframing supply chain risk and mitigation and to consider other factors that can be
influential in varying the risk profile of organizations and their management practices. If these factors are considered holistically, they can offer operational efficiencies
without compromising service excellence and enabling greater market access, a clear
case of de facto greater organizational performance.
However, as illustrated in Figure 5.1, for this approach to be effective it must be
used to recognize and address latent customer needs and expectations, cultural pressures on and from suppliers, and the competitive drivers that exist within any supply
chain by gaining a thorough understanding of the marketplace. Traditional strategic
management tools such as SWOT and PESTLE analysis can be powerful in helping to
develop this type of