Value Chain Management is a strategic chain that adds value to a product by virtue of their additional work. The work involved can be physical labor or it can be documenting the item or authenticating it. It's anything that involves providing additional content or improving content.
The aim of this strategy is to be as profitable as possible, as with all business, by chipping off costs here and there. An example of this would be to have a manufacturer near a production plant, to save transport costs and transport time. It's a very efficient way of lowering expenditure and speeds up the production process.
Value Chain Management requires all company data to be pooled together to improve efficiency. The idea is that, with the data accessible by all and easily found, there will be smoother operations and ultimately a quicker time to market their product or service.
The fact is yes, it is a very sensible plan. If everyone can access all the same data then everyone works off the same information and there won't be - or shouldn't be - any confusion in figures or projections.
The problem comes with implementing such a system. The computer system required is expensive; it costs a lot in terms of labor to implement an intranet to connect all the computers and make sure they run on a stable and effective server.
Add to that the software itself costs a large amount, and then there's the extra work in case computer models are different, or have different ages and software on them. Furthermore then there's the maintenance of such a server and system; someone needs to be on hand to fault find and repair and errors of bugs or crashes.
Unsurprisingly yes. With large companies there comes the problem of communication between divisions. In really big companies it's almost like divisions are themselves separate entities, and so while they do cooperate with each other, the channels for interaction can be quite stretched and it takes time.
The aim of this strategy is to be as profitable as possible, as with all business, by chipping off costs here and there. An example of this would be to have a manufacturer near a production plant, to save transport costs and transport time. It's a very efficient way of lowering expenditure and speeds up the production process.
Value Chain Management requires all company data to be pooled together to improve efficiency. The idea is that, with the data accessible by all and easily found, there will be smoother operations and ultimately a quicker time to market their product or service.
- Isn't that a good idea?
The fact is yes, it is a very sensible plan. If everyone can access all the same data then everyone works off the same information and there won't be - or shouldn't be - any confusion in figures or projections.
The problem comes with implementing such a system. The computer system required is expensive; it costs a lot in terms of labor to implement an intranet to connect all the computers and make sure they run on a stable and effective server.
Add to that the software itself costs a large amount, and then there's the extra work in case computer models are different, or have different ages and software on them. Furthermore then there's the maintenance of such a server and system; someone needs to be on hand to fault find and repair and errors of bugs or crashes.
- Are there any other challenges?
Unsurprisingly yes. With large companies there comes the problem of communication between divisions. In really big companies it's almost like divisions are themselves separate entities, and so while they do cooperate with each other, the channels for interaction can be quite stretched and it takes time.
