Supply chain profitability, quality and world-class organizations
Managing the supply chain is a core competence that the organization must possess to deliver profit and return on investment (ROI). It has a major impact on organizational objectives and effectiveness in achieving those objectives. According to Dyer (2000, p. 27) maximizing supply network effectiveness is the key to individual and supply chain profitability. Virtual integration is achieved by firms collaborating in partnership (alliance), which is also referred to in the literature as the extended enterprise, strategic network or virtual corporation. Figure 10.1 illustrates how supply chain strategies can impact upon sales revenues and costs and how total profit is affected as a consequence.