Supply Value Chain Essay

1. The supply value chain is a tool that disaggregates a firm into its core activities to help reduce costs and identify sources of competitiveness. It is a part of the value system that consists of a network of value chains. The value chain and core activities that are performed by any company include inbound logistics, operations, outbound logistics, marketing and sales, and service. Core suppliers associated activities that an organization renders the add value for the consumer. If these supply value chain actions are performed fine, it will result in higher customer satisfaction. An organization benefits from determining it’s supply value chain by identifying the supplier-based activities that boost customer satisfaction. The method will let the firm to focus on the expenses which are directly associated with the consumer.
2. Non-value-chain activities typically have costs but no effect on the customer and are referred to as the hidden factory. The hidden factory contains all the bureaucratic processes that are not part of the core activities. The Hidden Factory is a term that refers to activities in an …show more content…
From a quality perspective, an interesting variation of the value chain is the concept of the chain of customers. The chain of customers is revealed when you view the step in the chain after you as your own customer. Customers play a key role in the creation of supply chains. When you stop to think about how you configure your supply chain and why, it soon becomes apparent that most roads lead back to the customer. Buyers will find the most cost-effective suppliers to offer customers the best value, they will search for innovate partners to give consumers the best products and services, and they will endeavor to create a supply chain that is resilient to disruption and is ethically sound to ensure service quality. The customer is a key figure in the supply chain and their needs, values and opinions will affect the supplier decisions buyers