How should a supply chain strategy relate to an organization’s overall business strategy?

A supply chain strategy should align with an organization’s overall business strategy because both components are interdependent and work together toward common goals. When the supply chain strategy is in harmony with the business strategy, it helps enhance the overall efficiency and effectiveness of operations. This alignment ensures that the supply chain supports key business objectives such as cost leadership, differentiation, or market responsiveness.

Having a cohesive strategy allows for better resource allocation and higher levels of customer satisfaction, as the supply chain can be designed to meet the specific demands and targets set out by the business. This integration facilitates a smoother flow of information and materials, allowing the organization to be more agile and responsive to market changes or customer needs.

In contrast, operating independently or contradicting the business strategy can lead to inefficiencies, miscommunication, and a lack of coherent direction. Defining the supply chain strategy later would also likely lead to fundamental misalignments, as it would not be built with the overall business objectives in mind from the outset.