Misalignment of supply chain strategy can lead to overall business failure. Present literature provides a number of accounts that verify the fact. Cisco's inventory write-off of $2 bn in 2001 and failure of Furniture.com in 2000 are the famous examples. At the same time a number of case studies written on Dell, Wallmart and other companies suggest the importance of an overall alignment of supply chain strategy with business strategy. Recent AMR Research by Tony et al. (2009) concluded supply chain risk to be the most significant risk in business operations. An understanding of supply chain strategy and its alignment with business strategy has become an imperative for academicians and practitioners. The present study is an attempt to identify the challenges and issues in the area of supply chain alignment through contemporary literature survey. It presents a set of case studies in Fast Moving Consumer Goods (FMCG), real estate and manufacturing which justify the cause and elucidates the importance of aligning supply chain strategy with business strategy.

The issue of supply chain alignment with overall business strategy has always attracted researchers and practitioners. In fact misalignment can cause supply chain failure, thus increasing the costs and loss of customers for the overall business (Hoek and Mitchell, 2006). For example, in 2001 Cisco had to write-off inventory worth $2 bn due to poor management of sales forecasts and inventory policy pursued by the supply chain managers. In 1994, IBM had more orders for ThinkPad than expected, resulting in a great stock out situation which led to a loss of several million dollars. The reason was an inventory management across the supply chain which proved to be ineffective in achieving the business goals (Simchi et al., 2007). On the other hand, proper alignment can lead to successful business. Dell computer is a well-known name in computer business and literature attributes its success to the alignment of supply chain strategy with business strategy. Dell's strategic focus is cost and high volume of revenue assures its presence in the business. The company's supply chain strategy of maintaining faultless delivery quality, high degree of delivery reliability, short lead times and high delivery flexibility insures customer satisfaction which is the hallmark of its overall business strategy (Schnetzler et al., 2004). Similarly, Walmart's supply chain strategy has led to the achievement of its overall business goals. However, at the top management level dealing with business objectives, the issue of supply chain alignment is often ignored or receives less interest (Ross, 2003).

A literature review of supply chain strategy and related concepts reveals that the alignment of supply chain strategies with corporate and business strategies is considered to be essential for the overall success (Evans and Danks, 1998; Chopra and Meindl, 2005; Happek, 2007; and Simchi et al., 2007). Happek (2007) considers that only a proper alignment of business and supply chain strategies can result in successful business. But companies often have major gaps between their highest level of business strategy and their supply chain strategy. According to the author, the prevalent approach is to build up a supply chain strategy after the business strategy has been defined. However, the approach results in certain level of difficulties in a developing business strategy which can support options for infusion of very powerful supply chain models, guaranteeing success in the business environment.

Supply Chain Management Journal, Supply Chain Strategy, Business Strategy, Fast Moving Consumer Goods, Computer Business, Customer Satisfaction, Corporate Strategies, Supply Chain Models, Product Development Costs, Information Technology, Manufacturing Processes, Modernization Program, Enterprise Resource Planning, Domestic Industries.