Introduction
The goal of this essay is to explain the various functions and strategies of value chain
management and discuss how to implement them in a flat screen display business, so as to
improve the performance of the operating system which ultimately will increase the
efficiency and quality of production thereby helping them gain a competitive advantage
over their competitors. Which will result in increased the profits for the business.
Value Chain Management: Development of a set of functional-level strategies that increase
the performance of the operating system a company uses to transform inputs into finished
goods and services. (George and Jones, 2006:267)
Operating System: The different functional activities an organization combines and uses to
acquire inputs, convert inputs to outputs, and dispose of the outputs. (Answers, 2006:1)
Value chain
Refers to the idea that a company is chain of functional activities that transform inputs into
an output of goods and services that customer value.
Production function
Responsible for the creation of a good or service
Marketing and Sales function
Increase value customer perceives to be contained in a product
Service function
Provide after-sales service and support
Materials management function
Controls the movement of physical materials through the value chain
Information systems function
Controls the electronic system for managing inventory, tracking sales, pricing products,
etc.
(Michael E. Porter, 1985:37-43))
Therefore one must divide the business up into the fore mentioned functions, specifically:
creating an efficient and productive process whereby producing the flat-screen displays.
Design and come up with a competitive and catchy marketing campaign which promotes
the quality of the product and its value for money so as to increase the customers perceived
opinion of the product. Establish an after sales service department within the company so
as to offer consumers after-sales service and support with any problems which may arise
with the product. Develop an efficient and simple method in which the physical materials
needed to produce the flat-screen displays move along the value chain so as to lower costs
and increase overall efficiency, and lastly establish and maintain a electronic system
whereby one can efficiently manage the flat-screen inventory, the recording and progress
of the sales of the screens and the pricing of the inventory.
Improving Responsiveness to Customers
Usually customers prefer:
A lower price to a higher price.
High-quality products to low-quality products.
Quick service to slow service (also prefer good after-sale support)
Many features over few features.
Products that are; customized or tailored to their specific needs.
(George and Jones, 2006: 271)
