...losing ground as more styles, more colors, and better fit became more important to its customers. Market research showed that only 24% of women were completely satisfied with their jeans purchase, at $50 a pair they were becoming a tough sell. Levi’s responded by recognizing a need to be in closer touch with their customers. They began to open stores to sell directly to their customers (rather then trough another retailer). They also implemented new technology such as EDI to help their supply chain. Unfortunately the lag time for their products was still 8 months. Levi’s was a company that needed a way to strengthen their business. Using the value chain analysis Levi’s was a prime textbook case of a company that needed to improve its value chain in order to sustain a competitive advantage. The results of their value chain analysis are as follows: 1. Value: only 24% satisfaction rate. 2. Value stream: ROE average more then 38% lead to little improvement in their cumbersome value chain. 3. Continuous flow: 8 month lag time. 4. Pull: The customer initiated nothing, activity was driven by sales forecasts. 5. Perfection: A good ROE led management to miss opportunities in improvement. In addition, use a pull driven distribution strategy Levi’s lost big profits when retailers had to markdown their products in order to make them more appealing. Levi’s often made good on these markdowns to their retailers. Although the opening of Original Levi’s stores helped eliminate...
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...Assignment The Value Chain in Your Life Write a (minimum two but no more than three page) paper (not including title and reference pages) describing the value chain in your life. There is an already APA formatted template in Doc Sharing for you to use as your starting point for this assignment. If you use references in your paper to support your content, be sure to apply the APA in-text reference citation format. Any item listed on the References page must also be applied and cited within the paper. If you use verbatim quotes, put them within quotation marks, cite the reference and include a page number. This assignment is an opportunity for you to relate what you learned about the value chain in Unit 1 to your own life. For example, one element of a value chain is the focus on competitive advantage, so you might wish to elaborate on this aspect. Submit your completed paper into the Unit 1 Dropbox. Value Chain Analysis - Problem-Solving Training from MindTools.com You are here: > Home > Strategy Tools > Value Chain Analysis ... Value Chain Analysis is a useful tool for working out how you can create the greatest ..... Personal Goal Setting: Planning to live your life your way · How Good Is Your Time ...www.mindtools.com/pages/article/newTMC_10.htm Value Chain Analysis Achieving Excellence in the Things That Really Matter Value should be added at each link. © iStockphoto/melhi Value Chain Analysis is a useful tool...
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...technology. IT is the use of computers to collect, store and retrieve data. Professor use a lot of examples to instruct the relationship between information technology and people. As we know, companies use information technology to increase their profits. The example of Bestbuy attracts me a lot. As we can see, people always go to Bestbuy to try the products and purchased the item on Amazon.com as Amazon offers a cheaper price than Bestbuy. Then we talk about the three applications of IT, they are supply chain management(SCM), customer relationship management(CRM) and enterprise resource planning(ERP). And the five forces(entrants, competitors, substitution, suppliers, buyers) are important for a company. We have also learned the generic strategy in the class, Companies should choose a strategy to be mainly use when they enter a new market. Also, we have learned the value system and value chain. Value system is the personal and cultural values used for ethical. For the value chain, we learned how to use support actions in different situation. In summary, I have a briefly understand of information technology after the class. The use of examples let me understood the notion clearly and specifically. II. Material related to the Case Netflix is an online subscription-based DVD rental company founded in 1997. After first class, I think the 5 forces analysis(entrants, competitors, substitution, suppliers, buyers) can be used to make the company becomes better. Since they have...
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...MGSC01 - MIDTERM CASE: ECCO A/S - Global Value Chain Management Analyze the problem Alternatives Decision Criteria Recommendation Good to have a contingency plan (backup plan) Key questions: - If I’m right so far, then what? What are the implications - What is the larger context? - What else do I know? Personal? - What alternatives do I have? - What am I missing? Goals: The plan was to build five closely connected factories over the next four years with a total capacity of five million pairs of shoes per year, serving both export needs and the Chinese market, which was expected to grow in the future. Produce the world’s most comfortable and modern footwear for work and leisure. Increase revenue to 8 billion and to 9 billion by 2013, selling 24 million pairs of shoes a year. Increase production capacity by 15% per year Product Market Focus: aim at becoming better at telling what we stand for. Value Proposition: Core Activities: produced 80% of its shoes in-house Vision – integrating the global value chain - To be the most wanted brand within innovation and comfort footwear. - Position can only be attained by constantly and courageously researching new paths, investing in employees, in core competencies of product development and production technology. 80% of the company’s leaders should come from inside ECCO. 2004 Sales Children 11% Ladies 47 Men 30 Sports 12 (outdoor, walking, running and...
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...Integrating a Value Chain Perspective in Small Scale Enterprise Development TRAINING SCHEDULE November 19-30, 2012 Rural development generally includes supporting local people’s livelihoods through income-generating activities and small-scale enterprises. Previous program experiences point to the importance of building local entrepreneurship capacity, establishing business organizations, and enabling access to key institutional support services. New challenges have emerged that influence success of these development efforts such as: 1) managing the impact of emerging markets on rural producers and consumers, 2) improving competitiveness and efficiency of small-scale enterprises, and 3) promoting equitable gender sensitive contributions and benefits among stakeholders including private sector. More recently, value chain approaches have been explored to bring more benefits to rural producers through better market links. Course Description The course focuses on integrating a value chain perspective in rural development, and how this conceptual and methodological framework can enhance program strategies for sustainable livelihoods, profitable small scale enterprises and socially responsive private sector. Learning content includes: basic principles and concepts of value chain development, practical methods and tools in integrating value chain perspective in rural development programming, and lessons learned from case studies on linking rural enterprises to dynamic value chains. The course...
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...Question 1: Capital Budgeting (12 + 4 + 4 = 20 marks) | | Forgone Rent | Fitout | Equipment | Operating Expense | Advertising | Revenue | Net Cash Flow | Time Factor | Present Value | Y0 | | -150,000 | -120,000 | | | | -270000 | 1 | -270000 | Y1 | -60,000 | | | -180,000 | -40,000 | 400,000 | 120000 | 0.917 | 110040 | Y2 | -60,000 | | | -180,000 | -40,000 | 400,000 | 120000 | 0.842 | 101040 | Y3 | -60,000 | | 36,000 | -180,000 | -40,000 | 400,000 | 156000 | 0.772 | 120432 | Y4 | -60,000 | | -130,000 | -180,000 | -40,000 | 450,000 | 40000 | 0.708 | 28320 | Y5 | -60,000 | | | -180,000 | -15,000 | 450,000 | 195000 | 0.650 | 126750 | Y6 | -60,000 | 10,000 | 39,000 | -180,000 | -15,000 | 450,000 | 244000 | 0.596 | 145424 | | | | | | | | | At 9% | | | | | | | | | | NPV | 362006 | | 1 mark | 2 marks | 2 marks | 1 mark | 1 mark | 1 mark | 1 mark | 1 mark | 2 marks | | | | | | | | | | | a. Calculate the NPV for the proposed investment [12 marks as indicated in table above] | | | 1. Current rent 5,000 per month ($5000*12 = 60,000) | 2. Café fit-out 150,000; Residual value is 10,000 after 6 years | 3. Computer equipment 120,000; residual value 36,000 after 3 years; new computers purchased at beginning of Year 4 at 130,000; residual at end of Year 6 is 39,000 | | 4. Operating expense - 180,000 all six years | | | 5. Advertising 40,000 in first 4 years and 15,000 in the 2 years after that...
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...as give the organization a competitive advantage (Hitt & Robert, 2011, p.10). Value chain analysis is a model that was developed by Michael Porter to help an organization develop a strategy for its organization. Michael porter suggested that organization activities can be grouped into two major categories which include the following; primary and support activities. Primary activities are those activities that are geared towards the creation and delivering of a product. Examples of primary activities include component assembly (Schmitz, 2005, p.20). Support activities on the other hand are not directly related to the production of a product or service. Such activities are those activities that can increase the efficiency or effectiveness within a business. For example, human resource management is an example of support activities. This essay is going to evaluate the process of value chain analysis and its application in the following two companies; Netflix and Redbox companies. 2.0 Background information. Netflix is an online movie streaming and email DVD Company. The company offers consumers a chance to stream live various movies over the internet. In order to use Netflix, consumers are required to register on the company’s website. The registration will involve paying a monthly subscription fee. Consumers are able to stream movies and watch live televisions show to their personal computers or even television sets. Netflix is only...
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...examine the possibility of an additional expansion into the United States, Franssen must address two pressing issues that are inhibiting The Body Shop’s success: Mismanaged growth and a problematic organizational structure. Mismanaged Growth Many organizations strive to become successful as quickly as possible but there are times when well-run companies begin to fail because they grew to quickly. Preparing for growth is a crucial step in ensuring the sustainable development of a firm. There are a number of symptoms that clearly indicate the growth of a company is being mismanaged. In the case of The Body Shop, they include owner/employee fatigue, lack of coordination, and production inefficiencies. Since the Franssens have such a high personal stake in the company they like to be as involved in as many of the franchises and operations as possible. During the inception of the first few franchises this was feasible, but as more locations were opened they have devoted less and less time to each respective site. The...
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...global integration and market responsiveness 3 7. The value chain as a framework for identifying international competitive advantage 4 8. Value shop and the service value chain 5 9. Information business and the virtual value chain 5 CHAPTER 2: Initiation of internationalization 8 1. Introduction 8 2. Internationalization motives 8 3. Triggers of export initiation (change agents) 9 4. Internationalization barriers / risks 9 SESSION 2 11 CHAPTER 3: Internationalization theories 11 1. Introduction 11 2. The Uppsala internationalization model 11 3. The transaction cost analysis model 11 4. The network model 12 5. Internationalization of SMEs 12 6. Born globals 12 7. Internationalization of services 13 CHAPTER 4: Development of the firm’s international competitiveness 15 1. Analysis of national competitiveness (the porter diamond) 15 1.1. Factor conditions 15 1.2. Demand conditions 15 1.3. Related and supporting industries 15 1.4. Firm strategy, structure and rivalry 15 1.5. Government 15 1.6. Chance 15 2. Competition analysis in an industry 15 2.1. Market competitors 16 2.2. Suppliers 16 2.3. Buyers 16 2.4. Substitutes 16 2.5. New entrants 16 2.6. Strategic groups 17 2.7. The collaborative five-sources model 17 3. Value chain analysis 17 3.1. Customer perceived value 17 3.2. The competitive triangle 18 3.3. Perceived value advantage 18 3.4. Relative cost advantage 18 3.5...
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...a memo from her on how her blog would provide a competitive advantage. He wanted that memo so that he could include it in the documentation he would use to justify the expense to his manager. The knowledge presented in this chapter will help her write that memo. An optional Extension for this chapter is CE3, “Knowledge Management and Expert Systems.” Study Questions Q1 Q2 Q3 Q4 Q5 Q6 How does organizational strategy determine information systems structure? What five forces determine industry structure? What is competitive strategy? What is a value chain? How do value chains determine business processes and information systems? How do information systems provide competitive advantages? How does the knowledge in this chapter help Dee and you? 37 38 Chapter 3 Organizational Strategy, Information Systems, and Competitive Advantage Industry Structure New Vendors Competitive Strategy Value Chains Business Processes Information Systems Threat of new entrants Lowest cost across the industry Customers Better product/service across the industry Better product/service within an industry segment Firm Infrastructure Support Activities Human Resources Technology Development Procurement Margin ItemsSold QuantitySold QuantityOnHand Inventory Database QuantityReceived Purchasing Hardware PurchaseOrder Software Data Procedures People Suppliers Bargaining power of suppliers Rivalry Bargaining power of customers ...
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...EXCEL International Journal of Multidisciplinary Management Studies Vol.2 Issue 5, May 2012, ISSN 2249 8834 Online available at http://zenithresearch.org.in/ DIVERSIFICATION - STRATEGIES FOR MANAGING A BUSINESS P. KANNAN*; DR. R.SARAVANAN** *Head, Department of Management Studies, N.P.R. College of Engineering & Technology, Natham. *Research Scholar, Anna University of Technology Coimbatore, Coimbatore, Tamil Nadu, India. **Director, School of Management, Sri Krishna College of Technology, Kovaipudur, Coimbatore- 641042, Tamil Nadu, India. ABSTRACT When thinking about building a diversified portfolio, remember the old adage, “Don’t put all your eggs in one basket.” Diversification is not only about the number of investments in your portfolio, it’s also about the relationships among those investments. Diversification becomes an attractive strategy when a company runs out of profitable growth opportunities in its core business. In a diversified company the strategy making challenge involves assessing multiple industry environments and coming up with a set of business strategies, in which it operates. Multinational diversification strategies feature a diversity of business and a diversity of national markets. Despite the complexity of having to devise and manage so many strategies, these strategies have considerable appeal and more competitive potential. The study focuses on the manner in which diversification strategy is applied for different sectors like IT, FMCG etc. It deals...
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...Caterpillar has over 3 million machines in usage and it runs in three primary lines of business such as Machinery, Engines, and Financial Products. . Strategic Overview In order to remain to excellently grow the business and success against the competition, Caterpillar has implemented Vision 2020, an enterprise strategy that emphases on the Company’s customers, employees, and stockholders. Vision 2020 is built on Caterpillar’s strategic goals, operating principals, and core values. The three primary strategic goals of Vision 2020 are to produce superior financial results, be a global industry leader and have the greatest team. Involved in Vision 2020 are Caterpillar’s “Big 8” requirements for 2011 through 2015 which is focus on how Caterpillar will success and preserve and improve its leadership position. Over Vision 2020, Caterpillar expects to win by delivering valued, quality products, services and solutions to customers that deliver the lowest total owning and operating lifecycle costs. This value plan, enabled by incomparable customer support, generates the largest global field population, highest customer loyalty and attractive profitability through the business cycle. Competitive Environment Caterpillar operates in the Farm and Construction Machinery Industry. Though,...
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...Value Chain & Strategy: Reading Material D.M.Ravi Dissanayake Senior Lecturer, Department of Marketing Mgt University of Kelaniya Introduction Michael Porter introduced the value chain analysis concept in his 1985 book ‘ The Competitive Advantage’ . Porter suggested that activities within an organization add value to the service and products that the organization produces, and all these activities should be run at optimum level if the organization is to gain any real competitive advantage. If they are run efficiently the value obtained should exceed the costs of running them i.e. customers should return to the organization and transact freely and willingly. Michael Porter suggested that the organization is split into ‘primary activities’ and ‘support activities’. Why it needs for strategists: * To analyze internal performance of SBUs or corporate as holistic * To understand how industry goes on KPIs and to keep SBU consistent * To organize activities to support for the generic strategy * As a base line for resource allocation * Performance review guide Understanding How Value is created within Organizations How does your organization create value? How do you change business inputs into business outputs in such a way that they have a greater value than the original cost of creating those outputs? This isn't just a dry question: it's a matter of fundamental importance to companies, because it addresses the economic logic of why the...
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...Chapter 1: Global marketing in the firm I. Introduction to globalization Globalization: reflects the trend of firms buying, developing producing and selling products and service in most countries and regions of the world. Benefits for the firm which do an international expansion: * New and potentially more profitable markets * Increase the firm’s competitiveness * Facilitates access to new product ideas, manufacturing innovations and the latest technology Internalization: doing business in many country of the world, but often limited to a certain region (ex: Europe). A. Industry globalism The strategic behaviour of firms depends on the international competitive structure within in industry. In the case of high degree of industry globalism, there are many interdependencies between markets, customers and suppliers, and the industry is dominated by a few large powerful players (global). Example of global industries: PCs, IT, records, movies and aircrafts. The other land (local) represents a multidomestic market environment, where markets exist independently from one other. Example of local industries: hairdressing, foods and dairies. B. Preparedness for internationalization The degree of preparedness is dependent on the firm’s ability to carry out strategies in the international marketplace and the actual skills in international business operations. The well-prepared company has a good basis for dominating the international markets and consequently...
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...1. Explain the terms of organizational strategy and strategic management? Ans; Strategic management is a way in which strategists set the objectives and proceed about attaining them .It deals with making implementing decision about future direction of in an organization. It helps us to identify the direction in which an organization is moving. It is continuous process that evaluates control the business and industries in which organization is involved. 2. Organization strategy is the strategy that concerned with your business creating a good value in eyes of your customers and making a strong position in the market. It describes the long term outlook for business and defining new technology and economic conditions. It can also be defined as knowledge of the goals, the uncertainty of event and need to take into consideration or actual behavior of others. 2. Describe the types of strategy in terms of organizational planning and development? Ans: : The types of strategy in terms of organizational planning development are following: * Corporate strategy: Corporate strategy is term which is used to combine or acquire with some other company. * Operational strategy: It is the term used by the area manager’s to give some instructions to the managers to sort out the problems within the organization. * Business strategy: it is the term used to enlarge our business ion the market by introducing new products and by god management skills. * Price...
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