Value Generation

 Value chain management focuses on creating a competitive advantage and enhancing value within the supply chain to maximize customer satisfaction.

The purpose of running an organization is to create value. It’s a healthy management discipline to gain a comprehensive value stream view, leverage value models to make wise investments, and manage multidimensional business value effectively. 

Value stream management involves overseeing resources, activities, and individuals in creating a product, from raw materials to final delivery. The primary objectives are to maintain quality, control costs, and improve efficiency throughout the supply chain, while also adapting to market demands.

Value stream management focuses on enhancing each step of the supply chain to add value and provide a competitive advantage, differing from supply chain management, which optimizes from production to the consumer. Value stream managers analyze market trends to align sourcing with customer preferences, consider marketing and sales, and oversee costs to influence consumer perception. The goal is to maximize customer satisfaction by creating a competitive advantage and enhancing value within the supply chain.

Value stream management maximizes customer satisfaction by creating a competitive advantage and enhancing value within the supply chain. Value chain managers analyze market trends to ensure sourcing aligns with customer preferences, consider marketing and sales, and oversee costs, as price affects consumers’ perception and experience of the product.

Supply chain and value chain management are related but have different aims. Supply chain management refers to the entire process of creating and delivering a product, while value chain management seeks to enhance each step to add value and provide a competitive advantage. The supply chain manager's responsibilities include:

-Sourcing

-Negotiating contracts

-Ensuring the quality of raw materials

-Planning and overseeing logistics, distribution, and inventory

-Creating contingency plans to avoid supply chain disruptions

The value chain manager's responsibilities include:

Analyzing market trends to match customer preferences

-Considering marketing and sales

-Overseeing costs in every stage of the product life cycle

Supply chain management optimizes value from the start of production to the consumer, while value chain management starts with consumer demand and traces optimization back to the earliest production stages. Supply chain management concerns the operational aspects of a product’s cycle, whereas value chain management focuses on creating a competitive advantage and enhancing value within the supply chain to maximize customer satisfaction.

Posted in: Strategy,Super Science