Importance Of Value Chain Management

Decent Essays
3.1. The Importance of Value Chain Management

To understand the importance of value chain management within the organization, we have to know about value chain itself first. Value chain is the full range of activities — including design, production, marketing and distribution — businesses go through to bring a product or service from conception to delivery. For companies that produce goods, the value chain starts with the raw materials used to make their products, and consists of everything that is added to it before it is sold to consumers. In other words, value chain is the entire series of organizational work activities that add value at each step from raw materials to finished product. So the value chain management is the process of managing
…show more content…
First, the organization focused on vertically integrated operations. This method give us the direct control of everything, for example if you manufactured a product, you wanted to control the material sources, the transportation, the warehousing, the production, and possibly even the retailing of your product. The theory held that more vertical elements that were under your direct control, the more efficiently you were able to perform. Soon, because of the technology development and globalization, they focus more on their core competencies and not try to do everything alone. For example, if you have a manufacturing company, you cooperate with shipping company to distribute your products. And after that, managers eventually realize that the most important thing is about …show more content…
There are 3 major points about value chain management; time matters, and relationship and collaboration
In order to improve in time matters, a company can do things like build value chain programs on the foundation of earlier recovery efforts. When a country is having a breakdown after a bad situation, they will eventually recover. During this recovery, they will rebuilding opens new markets for construction labor, materials and asset replacement, and value chain development activities can strengthen relationships and trust built during these recovery efforts. This is the time where managers should take the chance of market opportunities.
The other thing that the company can do regarding to time matters is to use aggressive approach. Introducing new ideas and skills over time can help value chain programs take advantage of the most accessible opportunities and generate early momentum while staying on a path toward more attractive markets over the long term. An excellent example is a value chain project in Sudan that took a progressive learning approach, selecting a non-commercialized product—shea butter—that was owned by communities and managed by women, and then developing a higher-value market system around this basic

Related Documents

  • Superior Essays

    Tiger Boots Case Study

    • 1050 Words
    • 5 Pages

    For the organizational change at Tiger Boots, I would recommend a planned approach using Kotter’s 8-step Model of Change. Kotter’s Model includes eight steps that serve as an effective framework to plan and executive organizational change. The Tiger Boots case reflects a goal of new market entry accompanied by a capacity change implementation. Tiger Boots has decided to enter a new market of lower-cost casual menswear but lacks the appropriate production capacity, marketing relationships, and a solid strategic plan, as there are many unanswered questions. The nature of the change is rather large scale, as it requires a restructuring of company operations to find new channels for capacity increases.…

    • 1050 Words
    • 5 Pages
    Superior Essays
  • Decent Essays

    1. Workforce demographics: Workforce crises are featured by shortage of skilled labor in the market. It’s the role of the vocational and higher learning institutions to supply the market with candidates who have competent skills and talents. On the other side, on-job career development is a strategy that solves organizational leadership crises before they materialize.…

    • 497 Words
    • 2 Pages
    Decent Essays
  • Improved Essays

    Corlynn: Company Analysis

    • 954 Words
    • 4 Pages

    Abstract This paper discusses and analyzes a company that was established in 2015 named CorLynn. CorLynn was created to produce homeless bags that a small family of four could pass out from their cars and then expanded to a clothing and accessory company that features products with Bible verses and messages. CorLynn provides these products through and online store as well as a storefront located in Terre Haute, IN. Key topics and concepts will be covered in this paper to include; design strategy, mass customization, customer satisfaction, innovation, target market, inventory management, product life cycle, balanced scorecard, and ISO 9000.…

    • 954 Words
    • 4 Pages
    Improved Essays
  • Improved Essays

    Aramark Case Summary

    • 694 Words
    • 3 Pages

    difference is that Aramark does not produce or deliver any product of its own creation to its clients and ultimate consumers. As a result, Aramark’s Supply Chain Management team must manage the process of getting product from its manufacturers to its distributors who then deliver it to its client locations. The team leverages point of sale data from Aramark’s locations in order to determine what is being purchased which provides insight heading into contract negotiations with suppliers. The team also uses that same data to monitor and audit distributor deliveries at its locations.…

    • 694 Words
    • 3 Pages
    Improved Essays
  • Great Essays

    Supply Chain Strategy Assignment 2 Executive Summary Supply chains incorporate the end-to-end stream of data, items, and cash. Therefore, the way they are overseen emphatically influences an association's intensity in such territories as item cost, working capital necessities, velocity to market, and administration recognition, among others. In this connection, the best possible arrangement of the supply chain with business procedure is key to guarantee an abnormal state of business execution. Crowning Glory Ltd is a private company that has grown from small beginnings over the past 20 years to become a major supplier of hair-care products to the hairdressing trade. Its products are well liked by professional hairdressers and the company…

    • 1725 Words
    • 7 Pages
    Great Essays
  • Superior Essays

    In this paper, I am going to talk about what should a value chain look like in a healthcare organization, and then I will explain how it works. After I will provide an example of an organization with its value chain. Later I will provide step-by-step how it could fix a problem it has. In summary, I will provide evidence of how it would successes and recommendations how to prevent the same problem in future.…

    • 1041 Words
    • 5 Pages
    Superior Essays
  • Improved Essays

    In general, the purpose of analytics in basketball is for a positive result. The highest positive result is the NBA title championship. This is the only measurement of a good business in the NBA. Using analytics in basketball can help lead a team to that championship game. Using a value chain, adding activities to pass through a chain and gaining value at each stage along with analytics can further the likelihood of not only going to the championship game, but winning it.…

    • 824 Words
    • 4 Pages
    Improved Essays
  • Improved Essays

    There are five major competitors in the industry that hold approximately 78% of the overall market share (Blue Buffalo Pet Products, Inc. Final Prospectus, 2015). Blue Buffalo, who specializes in “wholesome natural products” and is a relatively new entrant in the market will provide baseline figures. (Blue Buffalo Pet Products, Inc.…

    • 648 Words
    • 3 Pages
    Improved Essays
  • Improved Essays

    Yes, Nordstrom’s strategy is working. The key points in their strategy are to provide excellent customer service, high quality products. They are also continuously trying to be ahead of their competition when it comes to getting the younger and being on the forefront of technology advances. In terms of customer service, they are at the top of their competition because they not only are conscious of the type of people they hire, but also through their return policy. The return policy, simply, is no return policy; there is no time limit and no receipt requirements.…

    • 717 Words
    • 3 Pages
    Improved Essays
  • Improved Essays

    M1A1 Supply Chain Strategy & Competitive Priority How do companies like FedEx and Walmart manage their supply chain systems to maintain a competitive advantage in today’s business world? According to Nada Sanders (2012), it’s done through the active management and implementation of the five primary competitive priorities; Cost, Time, Innovation, Quality, and Service, as well as an effective supply chain strategy. Supply chain strategy design is composed of the five competitive priorities, and how those priorities are implemented and managed helps create and maintain a competitive advantage in the business world.…

    • 705 Words
    • 3 Pages
    Improved Essays
  • Great Essays

    These strategies improve a businesses production process. An improved production process will, in turn, result in a business achieving key performance indicators such as speed and quality, consequently becoming a cost leader or product differentiator, expanding the business life cycle. A company must have a clear vision, create goals and have…

    • 1487 Words
    • 6 Pages
    Great Essays
  • Great Essays

    1.0 Executive Summary Supply Chain refers to the flow of products or services start from the point of origin from the supplier to end consumer (Investopedia, 2003). Supply chain management refers to the design and management of seamless, value added processes across organizational boundaries to meet the needs of end consumer. Supply chain management is very important for a company to success especially for those multinational companies as nowadays the supply chain emphasizes on building trust-based relationship with the supplier and the company can focus on their core competencies for a long term benefits with a common goals. A supply chain management started with key suppliers and has four important elements.…

    • 5288 Words
    • 22 Pages
    Great Essays
  • Improved Essays

    Introduction Boeing 787 Dreamliner is the project plan of Boeing company about light weight aircraft with high technology. The project of this aircraft has facing several problems such as software problem that led to engine shutting down automatically, lithium ion battery that causes fire inside the aircraft and others problem that led delay in the production. The Boeing 787 has 3 different categories which are 787-3 that has been designed to fit in 250 passengers, 2 class, short range body and with range of 2,500 to 3,050 nautical miles (4,650 to 5,650 km) because the aircraft have les market therefore it only popular in Japanese market because it adapts to local customer’s demand, 787-8 with 242 passengers seat and can fly for 13,621 km.…

    • 1121 Words
    • 5 Pages
    Improved Essays
  • Great Essays

    And, also it calls for the identification of all sources of poor quality and rectifying them. Secondly, changes in management and labour relations. Decentralization, specialization, shift in occupational structure, pay, evaluation etc. are also important. Thirdly, transformation of design and changing relations with suppliers in order to extend JIT and TQM along the supply chain. Operationalization of such policies that are designed to involve, motivate and control workers much differently than Fordism and mass production increased efficiency of output and profitability (Humphrey,…

    • 1185 Words
    • 5 Pages
    Great Essays
  • Improved Essays

    Supply chain management (SCM) adopts a scientific and integrative approach to managing the operations and relationships among totally different parties in provide chains. To implement. SCM with success exploitation Six letter of the alphabet in cement sector a case study of UltraTech Cement Ltd is one among the foremost problems is provider development. On the opposite hand, studies have investigated however quality management will be used in SCM to enhance the performance of assorted problems within the whole provide network. This study can develop associate degree application guideline for the assessment, improvement, and management of quality in SCM exploitation Six-Sigma improvement methodology.…

    • 1074 Words
    • 5 Pages
    Improved Essays