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PRODUCT ENTRANCE-EXIT STRATEGIES AND SUPPLY CHAIN STRATEGIES
Robert H. Burgess, Georgia Institute of Technology, Atlanta, GA 30332-0520,
Robert.burgess@mgt.gatech.edu, (404) 894-3899
Craig A. Hill, Associate Professor of Supply Chain Management, Clayton State University, Morrow, GA
30260-0285, CraigHill@clayton.edu, (678) 466-4549
James S. Keebler, Clayton State University, Morrow, GA 30260-0285, JamesKeebler@clayton.edu,
(678) 466-4548
ABSTRACT
There are many strategies that companies use to manage their supply chain. This paper suggests that you
take into account your product’s lifecycle and your market entrance and market exit strategies when
developing your supply chain strategy. The paper presents a review and overview of the development of
supply chain strategies. The strategy development occurs as you include manufacturing strategies,
entrance-exit strategies and the product life cycle to the supply chain strategy. This paper gives a basis
for the building of a research model that includes these issues.
I. Supply Chain Strategies
There has been considerable amount of research done on the strategies that companies undertake to
manage their supply chains. Underlying this research is the idea that companies would be advised to
undertake different types of strategies depending on their product’s production needs and the needs of
their customer [1]. One of the better known strategies for managing supply chains is given in Hau Lee’s
uncertainty matrix. In this case the strategies are classified by the uncertainty contained in the supply of
the product as well as the uncertainty contained in the demand for the product.
This yields four types of strategies for supply chain management. The first is an Efficient supply chain
structure. The products would have with low uncertainty in both supply and demand. The products
delivered in this type of supply chain would be functional products with a very well known and stable
process. This would include products such as food and beverages. The second strategy classification
would be the Responsive supply chain which would include innovative products made on a stable process
such as fashion apparel and computers. The third supply chain strategy classification would be Risk
Hedging supply chains. The product in this case is functional, but its production process is evolving and
not well known. Examples of products in this classification would be ethanol production and other
evolving green energy production types. The last classification would be an Agile supply chain. In this
case the process of production is evolving and the product is highly innovative. Products in this
classification would include telecom and high end computers and semiconductors.
The Hau Lee uncertainty framework is an example of how supply chains can be classified based on the
type of strategy that is necessary for the better management of the supply chain process. In a similar
fashion this paper highlights how the supply chain strategies that are chosen for managing the supply
chain can vary depending on the strategies a company holds for its product life cycle and the entrance-exit
strategy that it uses for its products. This research works to incorporate the product development field of
research with the emerging study of supply chain management strategies [2].