Understanding Strategic Fit

Strategic fit refers to the alignment between the competitive strategy of a company and its supply chain strategy (Contador et al., 2021). It involves ensuring that the capabilities and processes of the supply chain can support and complement the overall business strategy. The goal is to create a seamless integration where each component of the supply chain enhances the other, which should contribute to the competitive advantage and profitability of the company. A strategic fit enables the company to be more efficient in terms of managing costs, ensuring customer satisfaction, and staying ahead of competitors.

Push/Pull Processes

The concepts of push and pull in supply chain management refer to the underlying operational processes. Push processes are also known as "make to stock," and involve producing goods based on demand forecasts before actual purchase orders from customers are received (Van Donk, 2001). With this approach, the risk...

Pull processes, on the other hand, are known as "make to order," and involve producing goods only after receiving a customer's order (Van Donk, 2001). This approach reduces the risk of overproduction but requires a responsive and flexible production process to meet customer demands quickly.

A combination of push and pull processes is typically used in a push-pull boundary or decoupling point. It is an approach in which push processes for the upstream supply chain and pull processes for the downstream supply chain are implemented so...

…ensure strategic fit, a company must first clearly define its competitive strategy and understand its customers' needs. The supply chain strategy must then be designed to support this competitive strategy. For example, if the competitive strategy is to provide a wide range of products quickly, the supply chain should be designed for high responsiveness, which might involve an agile approach and pull processes. The company must also understand the level of implied uncertainty in its supply chain (from demand and supply variations), and align its supply chain capabilities to handle this uncertainty. This involves making trade-offs between responsiveness and efficiency based on the level of uncertainty. Lastly, the strategic fit should be reviewed and adjusted over time as market conditions, customer needs,…