Contents
Learning
Guide
Rationale
In
management, Business
Value is an informal term that includes all forms
of value that determine the health and well-being of
the firm in the long-run. Business value expands
concept of value of the firm beyond economic value (also
known as economic
profit, Economic
value addedtm, and Shareholder
value) to include other forms of value such as employee
value, customer value, supplier value, channel partner
value, alliance partner value, managerial value, and
societal value. Many of these forms of value are not
directly measured in monetary terms.
Business
value often embraces intangible assets not necessarily
attributable to any stakeholder group.
Examples include intellectual
capital and a firm's business
model. The Balanced
scorecard methodology is one of the most popular
methods for measuring and managing business value.
The Value
Chain, also known as value chain analysis,
is a concept from business management that was first
described and popularized by Michael
Porter in his 1985 best-seller, Competitive
Advantage: Creating and Sustaining Superior Performance.
A
value chain is a chain of activities. Products pass all
activities of the chain in order and at each activity
the product gains some value. The chain of activities
gives the products more added value than the sum of added
values of all activities. It is important not to mix
the concept of the value chain, with the costs occurring
throughout the activities. A diamond cutter can be used
as an example of the difference. The cutting activity
may have a low cost, but the activity adds to much of
the value of the end product, since a rough diamond is
a lot less valuable than a cut diamond.
The
value chain categorizes the generic value-adding
activities of an organization. The "primary activities" include: inbound
logistics, operations (production), outbound logistics,
marketing and sales, and services (maintenance). The "support
activities" include: administrative infrastructure management,
human resource management, R&D, and procurement.
The costs and value drivers are identified for each value
activity. The value chain framework quickly made its
way to the forefront of management thought as a powerful
analysis tool for strategic
planning. Its ultimate goal is to maximize value
creation while minimizing costs.
The
concept has been extended beyond individual organizations.
It can apply to whole supply
chains and distribution networks.
The delivery of a mix of products and services to
the end customer will mobilize different economic factors,
each managing its own value chain. The industry wide
synchronized interactions of those local value chains
create an extended value chain, sometimes global in extent.
Porter terms this larger interconnected system of value
chains the "value system."
A value system includes the value chains of a firm's supplier
(and their suppliers all the way back), the firm itself,
the firm distribution channels, and the firm's buyers (and
presumably extended to the buyers of their products, and
so on).
Capturing
the value generated along the chain is the new approach
taken by many management strategists. For example, a
manufacturer might require its parts suppliers to be
located nearby its assembly plant to minimize the cost
of transportation. By exploiting the upstream and downstream
information flowing along the value chain, the firms
may try to bypass the intermediaries creating new business
models, or in other ways create improvements in its
value system.
The
Supply-Chain Council, a global trade consortium in operation
with over 700 member companies, governmental, academic,
and consulting groups participating in the last 10 years,
manages the de facto universal reference model
for Supply
Chain including Planning, Procurement, Manufacturing,
Order Management, Logistics, Returns, and Retail; Product
and Service Design including Design Planning, Research,
Prototyping, Integration, Launch and Revision, and Sales
including CRM, Service Support, Sales, and Contract Management
which are congruent to the Porter framework. The "SCOR" framework
has been adopted by hundreds of companies as well as
national entities as a standard for business excellence,
and the US DOD has adopted the newly-launched "DCOR" framework
for product design as a standard to use for managing
their development processes. In addition to process elements,
these reference frameworks also maintain a vast database
of standard process metrics aligned to the Porter model,
as well as a large and constantly researched database
of prescriptive universal best practices for process
execution.
A
value chain reference model (VRM)
has been developed by the Value
Chain Group to offer de facto standard for
value chain management encompassing one unified reference
framework representing the process domains of product
development, customer relations and supply networks
called the Value Reference Model, or VRM. VRM is the
next generation Business Process Management that extends
the Supply Chain processes of Acquire, Build, Fulfill
and Support to include Market, Research, Develop, Brand,
Sell and Support. The three centers of excellence are product
excellence, operations excellence, and customer
excellence.
Value
chain analysis is a process for understanding the
systemic factors and conditions under which a value chain
and its firms can achieve higher levels of performance.
When using value chains as a means for fostering growth
and reducing poverty, the analysis focuses on identifying
ways to contribute to two objectives: i) improving the
competitiveness of value chains with large numbers of small
firms, and ii) expanding the depth and breadth of benefits
generated.
Typically,
the aim of value chain analysis is to understand all
the major constraints to improved performance or competitiveness.
However, USAID recommends a strategic approach that focuses
on understanding end-market opportunities and the constraints
to these opportunities—such an approach obviates
the need to understand all constraints and narrows the
scope of the analysis to "constraints to opportunities."
The results of the analysis offer industry stakeholders
a vision for value chain competitiveness and form the basis
for a competitiveness
strategy—a plan for eliminating constraints to
end market opportunities and advancing sustainable competitiveness
(graphically depicted on right).
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Marketing
strategy and management
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Marketing
strategy [1][2] is
a process that can allow an organization to concentrate
its limited resources on the greatest opportunities to
increase sales and achieve a sustainable competitive
advantage[3].
A marketing strategy should be centered around the key
concept that customer
satisfaction is the main goal.
Understanding
markets
Tutorials
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Information
management (IM) is the collection
and management of information from
one or more sources and the distribution of that
information to one or more audiences. This sometimes
involves those who have a stake in, or a right
to that information. Management means
the organization of and control over the structure,
processing and delivery of information.
Throughout
the 1970s this was largely limited to files, file
maintenance, and the life
cycle management of paper-based files, other
media and records. With the proliferation of information
technology starting in the 1970s, the job of information
management took on a new light, and also began to
include the field of Data
maintenance. No longer was information management
a simple job that could be performed by almost anyone.
An understanding of the technology involved, and
the theory behind it became necessary. As information
storage shifted to electronic means, this became
more and more difficult. By the late 1990s when information
was regularly disseminated across computer networks
and by other electronic means, network managers,
in a sense, became information managers. |
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Those
individuals found themselves tasked with increasingly
complex tasks, hardware and software. With the latest tools
available, information management has become a powerful
resource and a large expense for many organizations.
In short, information management entails organizing, retrieving,
acquiring and maintaining information. It is closely related
to and overlapping with the practice of Data Management.
Consumer
behaviour is the study of when, why, how, and
where people do or do not buy product.
It blends elements from psychology, sociology, social anthropology and economics.
It attempts to understand the buyer decision making process,
both individually and in groups. It studies characteristics
of individual consumers such as demographics and
behavioural variables in an attempt to understand people's
wants. It also tries to assess influences on the consumer from
groups such as family, friends, reference groups, and society
in general.
Customer behaviour study is based on consumer buying behaviour,
with the customer playing the three distinct roles of user,
payer and buyer. Relationship marketing is an influential
asset for customer behaviour analysis as it has a keen
interest in the re-discovery of the true meaning of marketing
through the re-affirmation of the importance of the customer
or buyer. A greater importance is also placed on consumer
retention, customer relationship management, personalisation,
customisation and one-to-one marketing. Social functions
can be categorized into social choice and welfare functions.
Each
method for vote counting is assumed as a social function
but if Arrow’s possibility
theorem is used for a social function, social welfare
function is achieved. Some specifications of the social
functions are decisiveness, neutrality, anonymity, monotonicity,
unanimity, homogeneity and weak and strong Pareto
optimality. No social choice function meets these requirements
in an ordinal scale simultaneously. The most important
characteristic of a social function is identification of
the interactive effect of alternatives and creating a logical
relation with the ranks. Marketing provides services in
order to satisfy customers. With that in mind, the productive
system is considered from its beginning at the production
level, to the end of the cycle, the consumer (Kioumarsi
et al., 2009).
Belch
and Belch define consumer behaviour as 'the process
and activities people engage in when searching for, selecting,
purchasing, using, evaluating, and disposing of products
and services so as to satisfy their needs and desires'.'
The Marketing Mix
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Evaluating marketing
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