Capabilities and Distinctive Competencies Based

¶ … Capabilities and Distinctive Competencies

Based in Hong Kong, Li & Fung Limited is a global trading organization that specializes in high-volume, time-sensitive consumer goods such as garments, fashion accessories, gifts, furnishings, handcrafts, home products, toys and travel goods. It is a supply chain manager across a number of producers and companies and is distinctive in its ability to also provide product design and development, raw materials and factory sourcing, short- and long-term production planning and management, and quality assurance and expert documentation along with global shipping consolidation. This massive endeavor is coordinated from Hong Kong and through a network of 70 offices in over 40 countries. For a time, most of their manufacturing was concentrated in Asia due to cost considerations, with the advent of globalization and global markets and transportation, the company has expanded its manufacturing additions to Easter and Central Europe and Central and South America (Radhika, 2005). The company is able to remain extremely competitive due to its relationship and proximity to Asian manufacturers.

Part 2 -- Corporate and Business Level Strategies

Li and Fung has several strategies that help engender its competitiveness and success in the marketplace. First is its strategic movement from the 1970s on to initiate a three stage supply chain management organization; completely driven by globalization, modernization in China, and consumer and retail preferences. First, they acted as a regional sourcing agent, then a management company, and finally to use other Asian countries as labor-intensive manufacturing hubs, remaining in a position to manage and develop strategic markets (Li and Fung Ltd., 2012).

As a strategic endeavor, Li and Fun uses dispersed manufacturing in which the company performs all the high end value added actions (deign, quality control) and outsources the low end actions across the world. This allows the particular product to receive the best possible pricing because it is manufactured in the best possible environment, yet managed and marketed by a group dedicated to doing just that. In fact, it is the predominance of relationships within the various industries served that makes Li and Fung so successful. For instance, they might have a raw material spun into yarn or thread in one country, shipped closely to another country to be woven and dyed, then another country for zippers and buttons, then to yet another country for final assembly (Radhika, p. 8). When this is combined with a shorter product life cycle, globalism is served by the company's ability to keep up with trendy manufacturing needs and fickle fashion appetites.

Part 3 Relationship of Industry Life Cycle relating to strategies