Showing papers on "Value chain published in 2001"
TL;DR: The literature base and development of supply chain management from two separate paths that eventually merged into the modern era of a holistic and strategic approach to operations, materials and logistics management is reviewed in this article.
965 citations
TL;DR: In this article, the authors provide a framework for developing supply chain metrics that translate performance into shareholder value, focusing on managing the interfacing customer relationship management and supplier relationship management processes at each link in the supply chain.
Abstract: Most discussions and articles about supply chain metrics are, in actuality, about internal logistics performance measures. The lack of a widely accepted definition for supply chain management and the complexity associated with overlapping supply chains make the development of supply chain metrics difficult. Despite these problems, managers continue to pursue supply chain metrics as a means to increase their “line of sight” over areas they do not directly control, but have a direct impact on their company's performance. We provide a framework for developing supply chain metrics that translates performance into shareholder value. The framework focuses on managing the interfacing customer relationship management and supplier relationship management processes at each link in the supply chain. The translation of process improvements into supplier and customer profitability provides a method for developing metrics that identify opportunities for improved profitability and align objectives across all of the firms in the supply chain.
762 citations
TL;DR: In this paper, the authors provide strategic and operational descriptions of each of the eight supply chain processes identified by members of The Global Supply Chain Forum, as well as illustrations of the interfaces among the processes and an example of how a process approach can be implemented within an organization.
Abstract: Increasingly, supply chain management is being recognized as the management of key business processes across the network of organizations that comprise the supply chain. While many have recognized the benefits of a process approach to managing the business and the supply chain, most are vague about what processes are to be considered, what sub‐processes and activities are contained in each process, and how the processes interact with each other and with the traditional functional silos. In this paper, we provide strategic and operational descriptions of each of the eight supply chain processes identified by members of The Global Supply Chain Forum, as well as illustrations of the interfaces among the processes and an example of how a process approach can be implemented within an organization. Our aim is to provide managers with a framework to be used in implementing supply chain management, instructors with material useful in structuring a supply chain management course, and researchers with a set of opportunities for further development of the field.
648 citations
TL;DR: In this paper, the authors propose a collaborative e-business network that enables all the participants in a value chain to adopt simplified, standardized solutions based on common architectures and data models.
Abstract: As global markets grow increasingly efficient, competition no longer takes place between individual businesses, but between entire value chains. Collaboration through intelligent e‐business networks will provide the competitive edge that enables all the participants in a value chain to prevail and grow. Collaboration requires individual participants to adopt simplified, standardized solutions based on common architectures and data models. Time to market is critical, and participants will have to forego the luxuries of customization and modification that characterized the proprietary infrastructures of the past.
493 citations
TL;DR: In this article, a rationale for value-creating networks using three core building blocks: superior customer value, core competencies, and relationships is developed based upon an understanding of the value creation process and its links to core capabilities of firms in the network.
403 citations
TL;DR: In this article, the authors report on the results of research on the Indian software industry, including a questionnaire survey of Indian software firms, and field visits and interviews with industry participants, observers, and US based clients.
353 citations
Journal Article•
TL;DR: Barua et al. as discussed by the authors developed a research-backed model of e-business value creation, and the model's premise is deceptively simple: proper development of ebusiness drivers will lead to operational excellence, which will, in turn, generate improved financial performance.
Abstract: In trying to bring about e-business transformation, companies have paid too much attention to technology ? as if adding the right software or hardware could, on its own, bring about miracles. But systems do not work in a vacuum, and senior managers would do well to recognize the complementary nature of technology, business processes and e-business readiness throughout the value chain, from their suppliers to their customers. By taking a more holistic view, executives can turn these facets of a company's operations into the drivers of e-business excellence.
To help company leaders see the bigger picture, authors Anitesh Barua, Prabhudev Konana, Andrew B. Whinston and Fang Yin of the University of Texas at Austin's McCombs School of Business developed a research-backed model of e-business value creation. The model's premise is deceptively simple: that proper development of e-business drivers will lead to operational excellence, which will, in turn, generate improved financial performance. The authors explain that if managers are to lead a successful digital transformation, they must carefully track such e-business operational measures as the percentage of goods purchased online from suppliers and the percentage of customer-service requests handled through the Web site. Companies that scored high on those (and other) measures in the authors' study also enjoyed significant increases in revenue per employee, gross profit margin, return on assets and return on investments.
Once managers understand their company's relative degree of e-business operational excellence, they can develop the drivers that will raise those scores. The authors guide readers through the eight drivers their research uncovered, from mastering supplier-related processes to optimizing IT applications aimed at customers.
282 citations
TL;DR: In this paper, the authors investigate a set of strategies for information systems utilization in supply chain integration initiatives and argue that there might be a recommended sequence in using information systems for supply-chain integration.
Abstract: This paper investigates a set of strategies for information systems utilization in supply chain integration initiatives. We argue that there might be a recommended sequence in using information systems for supply chain integration. Support is provided through an analysis of structural relationships of ways in which information systems are utilized for supply chain integration, i.e., Infrastructural Support, Value Creation Management, Logistical Operations, and Supply Chain Management Performance.
272 citations
Journal Article•
TL;DR: In this article, the authors argue that island solutions sometimes backfire because they degrade other parts of the value chain, and they recommend companies to aim for a true build-to-order strategy, in which managers systematically improve the value-chain's flexibility in three areas: process, product and volume.
Abstract: All companies would like to offer custom products that delight their customers. For many, the challenges seem overwhelming, and they settle for manufacturing standard products in bulk, guided by long-term forecasts. Because demand is rarely forecast correctly, companies miss potential sales and must pay to store and manage excess product. In an effort to purge inventory, they offer discounts and other incentives. Profits erode, and the companies lose sight of what customers really want.
Some companies attempt to offset those effects by optimizing pieces of the value chain. They create island solutions, such as lean factories, believing that such initiatives will make them more responsive. The authors argue that those efforts ultimately fail because they are not customer- centered. Citing results from their research, sponsored by the 3DayCar Programme at Cardiff Business School in Wales and the International Motor Vehicle Program at MIT, they show that island solutions sometimes backfire because they degrade other parts of the value chain.
Instead, they urge companies to aim for a true build-to-order strategy, in which managers systematically improve the value chain's flexibility in three areas: process, product and volume. Because the emphasis at each stage is on how to meet customer demands efficiently, optimization becomes more holistic and ultimately more profitable.
To improve process flexibility, companies can link customer requirements directly to production, synchronizing customer-oriented production schedules in real time with suppliers. To improve product flexibility, they can push customization closer to the customer and can use common support structures to reduce the impact of product variety. To improve volume flexibility, the authors suggest ways companies can reduce reliance on full capacity or use differentiated pricing to reward customers for ordering products well in advance.
The authors urge managers not to settle for halfhearted transitions to build to order. They recommend two critical first steps: First, understand key aspects of customer demand; second, adjust all processes accordingly. Only then can companies truly implement responsiveness across the value chain.
256 citations
01 Jul 2001
TL;DR: In this paper, the authors apply value-chain analysis to an agricultural "commodity", which is in the process of significant change in final product markets, and identify power asymmetries along the chain.
Abstract: This article applies value-chain analysis to an agricultural 'commodity', which is in the process of significant change in final product markets. By focusing on the capacity of value-chain analysis to map input-output relations, and by identifying power asymmetries along the chain, it is possible to analyse the factors explaining inter-country distributional outcomes in this sector. A major conclusion is that we are witnessing a simultaneous process of power concentration in importing countries and power deconcentration in producing countries. It is hypothesised that similar trends can be observed in other agricultural-based value chains.
247 citations
TL;DR: In this article, the authors explore the design and renewal of services through the lens of methods and processes for developing product platforms for physical products and illustrate these principles with examples drawn from computer and electronic products.
TL;DR: It is concluded that, while there is little evidence of research exploring the integration of processes extending throughout supply chains, some businesses are gaining competitive advantage by maximising the efficiency of their “global” supply chains or “virtual” organisations.
Abstract: This paper presents a qualitative study of the integration of supply chain management and business process management activities. It reviews published literature in both fields and a number of supporting areas, revealing a minimal overlap in the research. A number of case studies of progressive organisations are examined, including an in‐depth study of Nortel Networks Corporation’s recent market repositioning and current supply chain integration activities. The study concludes that, while there is little evidence of research exploring the integration of processes extending throughout supply chains, some businesses are gaining competitive advantage by maximising the efficiency of their “global” supply chains or “virtual” organisations. A conceptual model of an integrated business process, derived from the case study, is presented, which highlights the importance of communication between processes and between partners in the supply chain.
TL;DR: In this paper, the authors apply value chain analysis to an agricultural "commodity" which is in the process of significant change in final product markets, and identify power asymmetries along the chain.
Abstract: Summaries This article applies value‐chain analysis to an agricultural ‘commodity’, which is in the process of significant change in final product markets. By focusing on the capacity of value‐chain analysis to map input‐output relations, and by identifying power asymmetries along the chain, it is possible to analyse the factors explaining inter‐country distributional outcomes in this sector. A major conclusion is that we are witnessing a simultaneous process of power concentration in importing countries and power deconcentration in producing countries. It is hypothesised that similar trends can be observed in other agricultural‐based value chains.
Book•
01 Jan 2001
TL;DR: In this article, the authors discuss the role of general managers in the deployment of technology in the value chain, and the importance of general management in general management of the technology environment.
Abstract: 1. Introduction. I. THEORETICAL FOUNDATIONS. 2. Technological Environment. 3. Process of Technology Change: Innovation. 4. Process of Technology Change: Diffusion. 5. Technology and Competition. 6. Process Innovation, Value Chains, and Organization. II. TECHNOLOGY STRATEGY: BASICS. 7. Technology Intelligence. 8. Technology Strategy: Overview. 9. Technology Strategy: Collaborative Mode. III. DOMAINS OF TECHNOLOGY STRATEGY. 10. Appropriation of Technology. 11. Deployment in New Products. 12. Deployment of Technology in the Value Chain. IV. ROLE OF GENERAL MANAGEMENT. 13. Organizing for Innovation. 14. Intellectual Property Strategy. 15. Project Valuation and Financing.
Book•
15 Feb 2001
TL;DR: In this article, the authors present a new supply chain management approach for the management of information technology value capture in the demand-supply chain, which they call Information Technology Value Capture.
Abstract: Introduction. Demand and Supply Chains--The New Supply Chain Management. Value Thresholds and Traps. Reshaping Your Value Offering--How to Do It. Excellence through Demand-Supply Chain Management. Operational Effectiveness--Know Your Own Demand Chain. Microcosms--Collaborate to Implement Effectively. Managing Information Technology--How to Stretch Your Business to Its Full Potential. Information Technology Value Capture--Linking IT Seamlessly to Business Opportunity. Wireless Communication Revolutionizes the Demand-Supply Chain. Index.
TL;DR: The role of IS as firm resources and the role of such resources in small firms (SMEs) are discussed and a number of areas for further research are identified including the operationalisation of the core competence perspective in developing an ISS.
Abstract: Research into the sources of competitive advantage identifies two competing views. The first concerns industry structure, and the role of information systems (IS) in enabling competitive advantage is to lower cost, build barriers to entry and tie in customers and suppliers. The second view is resource-based. This argues that competitive advantage arises from the ability to accumulate resources and capabilities that are rare, valuable, non-substitutable and difficult to imitate. This paper discusses the role of IS as firm resources and the role of such resources in small firms (SMEs). It uses as a vehicle, the identification and development of an information systems strategy (ISS) in a knowledge-based SME. The use of core competencies or capabilities, a key aspect of resources, as a basis for an ISS is contrasted with the use of a structural approach exemplified here by the value chain. Using participant observation research in a not-for-profit organisation that provides consultancy in social housing, this paper investigates these approaches. The paper concludes by identifying a number of areas for further research including the operationalisation of the core competence perspective in developing an ISS.
22 Sep 2001
TL;DR: A McKinsey study indicates that more effective outsourcing, which requires a better process for identifying and managing the "natural owner" of every activity in the value chain, could by itself almost double the auto industry's total profits as discussed by the authors.
Abstract: Farming out in-house operations has become a religion. Faith must now be tempered by reason. If all manufacturers sang from the same hymnal--and many do--they would outsource almost everything: management gospel holds that manufacturing is too labor -- and capital-intensive to support the high margins and fast growth that investors demand. By shedding assets, companies can be born again as product designers, solutions providers, industry innovators, or supply chain integrators-and, it is said, quickly boost their return on invested capital. Indeed, Standard & Poor's reports that in the year 2000, the market-to-book ratio of the SP done right, outsourcing manufacturing or services can deliver game-changing levels of value. But by assuming that outsourcing is the answer rather than critically assessing its pros and cons, companies may be failing to do what really matters: improving a company's performance and maximizing value. Outsourcing can be instrumental in realizing these goals--but not always. We are not suggesting a return to the time when Ford's River Rouge complex made its own glass, steel, and tires; an original-equipment manufacturer facing the complexities and asset intensiveness of that level of vertical integration would now collapse under its own weight. Indeed, about two-thirds of the North American auto industry's $750 billion in value now resides with suppliers. This year, the average electronics OEM was hoping to outsource 73 percent of its manufacturing, according to Bear Stearns, and 40 percent of all OEMs were hoping to outsource the manufacture of 90 percent or more of their final product. [2] Pharmaceuticals companies have been witnessing the emergence of a $30 billion contract drug-development and - manufacturing market with annual growth rates of 17 to 20 percent. [3] In general, the outsourcing of operations and facilities across industries rose by 18 percent in the period from 1999 to 2000. [4] Yet the rush to outsource has delivered much less value than it might have. A McKinsey study indicates that more effective outsourcing, which requires a better process for identifying and managing the "natural owner" of every activity in the value chain, could by itself almost double the auto industry's total profits. But so far, most of the supply networks of the automakers have been notable less for capturing a larger share of the total value for themselves than for imposing punitive (and ultimately unsustainable) terms on suppliers (see sidebar, "Biting the hand that feeds you," on the next page). …
TL;DR: In this paper, the authors combine the problem of safety stock planning in a general supply chain with the integration of external and internal product return and reuse in order to improve product reuse.
TL;DR: In this article, the authors examined the role played by intermediaries in the distribution chain of the tourism industry and explored the threats and opportunities that the emergence of the Internet, and other associated trends, present for the industry.
Abstract: The Internet is an important new channel for commerce in a wide range of industries. While the opportunities afforded by this phenomenon seem readily apparent, there is still much debate and speculation on exactly how the use of the Internet and in particular the World Wide Web will affect established industries. In this article we analyse the value chain of the tourism industry, using as a case study the tourism industry in South Africa. Specifically, we examine the roles played by intermediaries in the distribution chain and explore the threats and opportunities that the emergence of the Internet, and other associated trends, present for the industry. Based on this, a profile is made for successful new intermediaries and, finally, we assess the implications of this profile on the control of the electronic channel.
TL;DR: In this article, the authors focus on ways in which business marketers are creating value in the Internet and digital age, and highlight the managerial implications of such a paradigm shift in the business market.
TL;DR: This work is novel in that it integrates process-level knowledge from operational enterprises with distributed agent technologies and makes a contribution by demonstrating how agent-based supply chain integration can be effected along a large-scale, operational, inter-organizational process.
Abstract: Supply chain management represents a critical competency in today's fast-paced, global business environment. However, in the current transition from EDI to Web-based supply chain technologies, much of the capability for process integration is being lost. And the integration of buyer and seller supply chain processes is critical for speed and responsiveness in today's hypercompetitive product and service markets. Intelligent agent technology offers the potential to overcome many limitations of current supply chain technologies. This paper presents intelligent supply chain agents that represent and autonomously conduct business on behalf of product users, buyers and vendors. We classify and present numerous extant agent applications and extend a technological framework to compare and contrast intelligent agents with other classes of information technology. We then describe an agent-based supply chain process design, along with its developmental techniques, and the structure and behavior of an agent federation used for integration in a major enterprise. We present results of this exploratory research in terms of technical feasibility and process performance in the enterprise context. This work is novel in that it integrates process-level knowledge from operational enterprises with distributed agent technologies. And it makes a contribution by demonstrating how agent-based supply chain integration can be effected along a large-scale, operational, inter-organizational process.
TL;DR: In this paper, the concepts of hybrid supply chain strategies and the decoupling point are applied to a poultry supply chain experiencing high demand uncertainty in an inflexible production environment.
Abstract: The concepts of hybrid supply chain strategies and the decoupling point are applied to a poultry supply chain experiencing high demand uncertainty in an inflexible production environment. Several solutions are proposed for this supply chain to cope with high demand uncertainty. The customer order decoupling point, the product differentiation point and the information decoupling point play a central role in these solutions. Because of specific characteristics of the poultry supply chain, the opportunities for a leagile supply chain design are limited.
TL;DR: In this article, the virtual value chain offers a number of distinct advantages over the physical value chain, such as forging alliances between customers and manufacturers, advertising products and services selectively with effects of audio, video, and graphics, and saving time and money in efficiently processing customer orders and enquiries.
Abstract: In electronic commerce, businesses require to integrate two kinds of activities – ones that are embedded into the physical value chains and the others that are built through information into the virtual chain. Although the relative importance of these two kinds of chain depends on the characteristics of the products and services, their integration, nevertheless, plays a critical role in the success of e‐commerce. In e‐commerce, more and more value chain activities are conducted electronically, therefore, businesses should understand the implication of the virtual value chain activities. The virtual chain offers a number of distinct advantages over the physical value chain. Some of these advantages lie in forging alliances between customers and manufacturers, advertising products and services selectively with effects of audio, video, and graphics, and saving time and money in efficiently processing customer orders and enquiries. Besides, e‐commerce offers flexibility in option pricing and customization of products and service, by reducing the constraints of time and space.
TL;DR: In this article, the authors present a holistic model of the business-to-business value chain, which incorporates goals, the value chain (and value delivery chain), the total delivered product, and perceived outputs.
TL;DR: It is concluded that discrete event simulation is an effective tool to evaluate promising logistic scenarios and the new, multi-compartment method of distribution allowed for a 14% decrease in total costs in the Dutch CSC while satisfying customer demands.
TL;DR: This work presents a data structure for commitments that can be used in the agent-based communication framework for the management of a supply chain, and shows how commitments that deal with three different kinds of flow are related to one another and how they can affect the supply chain.
Abstract: As supply chain networks are becoming more and more global, process coordination must be considered a crucial point for successful business management. The need for a suitable management and communication framework is thus becoming evident. We already have some examples showing that information sharing is a key-point at certain levels of a supply chain network. As there are several analogies between a company in a business network and an agent, the Multi-Agent System paradigm can be a valid approach for modelling supply chain networks. We consider commitment as a concept that underlies the whole multi-agent environment, that is, an interagent state, reflecting a business relation between two companies that make themselves represented by software agents. We present a data structure for commitments that can be used in the agent-based communication framework for the management of a supply chain. Business partnership between companies leads to the creation of a "channel" through which we can identify three different kinds of flow (products, money and information). We show how commitments that deal with these flows are related to one another and how they can affect the supply chain.
TL;DR: In this article, the authors analyze the differential impact of the information and communication technology (ICT) revolution on each segment of the industry by examining the different stages of the value chain.
Abstract: E-commerce has contributed to the retail brokerage industry becoming more global and more contestable. By examining the different stages of the value chain, we can analyze the differential impact of the information and communication technology (ICT) revolution on each segment of the industry. To date, the primary drivers of globalization have been manifested at the ‘wholesale’ stage of the industry. In contrast, important features of the broker-customer interface have perpetuated a multi-locational competitive structure at the retail stage of the industry. Nevertheless, actual and potential competition has been significantly increased by the spread of e-commerce at all stages of the industry. E-commerce innovations encourage both standardization and variety within an increasingly competitive industry.
TL;DR: In this paper, the authors describe the current business conditions and the four key factors that need to be integrated in order to improve the supply chain and discuss how enterprise resource planning (ERP) is increasingly being used as a technology enabler for supply chain management and problems associated with its implementation.
Abstract: This paper describes the current business conditions and the four key factors that need to be integrated in order to improve the supply chain. The paper discusses how enterprise resource planning (ERP) is increasingly being used as a technology enabler for supply chain management and problems associated with its implementation.
TL;DR: The study explored the QEH value chain organisation and process structures and has identified questions concerning healthcare delivery and alternative methods for achieving current results and the future direction of the organisation.
Abstract: Quality and value are currently convergent concepts in healthcare. The importance of patients as customers has increased the focus on quality management and value delivery. The Queen Elizabeth Hospital in Rotorua is a specialist hospital for rheumatic disease and rehabilitation. It has a clear mission for the delivery of customer quality and in fulfilling this mission uses a holistic approach (a value chain approach) to customer care. The value chain study of QEH’s product/service delivery has enabled medical, medical support staff and management to review both value delivery quality and delivery methods. The study explored the QEH value chain organisation and process structures and has identified questions concerning healthcare delivery and alternative methods for achieving current results and the future direction of the organisation. Value chain analysis encourages an intra‐ and inter‐organisational review of resource application and identifies alternative methods and structures for meeting objectives.
Journal Article•
TL;DR: In this interview with HBR senior editor David Champion, Mark Levin, the founder and CEO of Millennium Pharmaceuticals, describes his vision of the future of the pharmaceutical industry in the wake of the genetics revolution and new technologies that have altered the economics of drug development.
Abstract: As today's business leaders are all too aware, a new scientific or technological break-through can quickly transform an industry's competitive landscape. The upheaval is often traumatic for the companies involved, forcing them to rethink their strategies and redefine their boundaries. But an industry in flux also creates vast opportunities. To seize them, companies must see how the current upheavals will affect the future distribution of profits--and then reinvent themselves to capitalize on the new sources of value. In this interview with HBR senior editor David Champion, Mark Levin, the founder and CEO of Millennium Pharmaceuticals, describes his vision of the future of the pharmaceutical industry in the wake of the genetics revolution and new technologies that have altered the economics of drug development. No company, he argues, will create serious long-term value by staying in just one or two stages of the value of chain. That's why Millennium, which started out doing basis research into genes and proteins and selling its findings to pharmaceutical giants, has moved downstream - toward the patients who actually use and pay for the drugs. He explains why the research end has become less lucrative than the more mechanical tasks of identifying, testing, and manufacturing molecules. Levin talks about the changes Millennium has undergone since its inception in 1993-from 30 workers to more than 1,000, and from one end of the value chain to the other. He discusses the company's cultural transformations as well as the partnerships and acquisitions that have helped millennium become involved in every stage of the chain-from gene to patient. Levin's vigorous approach to balancing long-term strategy with short-term tactics offers important lessons to any executive facing an industry upheaval.