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Chapter 9

Chapter 9. Value Chain Management. Four Ways to Create a Competitive Advantage. Functional Activities and the Value Chain. Impact of Increased Quality on Organizational Performance. Improving Quality. An organization able to provide a product of higher quality than a competitor’s

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Chapter 9

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  1. Chapter 9 Value Chain Management

  2. Four Ways to Create a Competitive Advantage MGMT 321 – Chapter 9

  3. Functional Activities and the Value Chain MGMT 321 – Chapter 9

  4. Impact of Increased Quality on Organizational Performance MGMT 321 – Chapter 9

  5. Improving Quality • An organization able to provide a product of higher quality than a competitor’s • Higher product quality can increase efficiency • Total quality management (TQM) • Improving quality by focusing on the entire value-chain of an organization MGMT 321 – Chapter 9

  6. Implementing TQM • Build organizational commitment to quality • Focus on the customer • Find ways to measure quality • Set goals and create incentives • Solicit input from employees MGMT 321 – Chapter 9

  7. Implementing TQM (cont.) • Identify defects and trace to source • Introduce just-in-time (JIT) inventory systems • Work closely with suppliers • Design for ease of production • Break down barriers between functions MGMT 321 – Chapter 9

  8. Facilities Layout, Flexible Manufacturing, and Efficiency • Facilities Layout • Designing the machine-worker interface to increase production system efficiency • Flexible Manufacturing • Use of IT to reduce the setup costs associated with a product assembly process MGMT 321 – Chapter 9

  9. Facilities Layouts MGMT 321 – Chapter 9

  10. Improving Efficiency • Just-in-time (JIT) inventory system • Gets components to the assembly line just as they are needed • Major cost savings can from increasing inventory turnover • Self-Managed Work Teams • Produce an entire product instead of just parts of it • Team members learn all tasks • Process Reengineering MGMT 321 – Chapter 9

  11. Two Kinds of Innovation • Quantum product innovation • Radically different kinds of goods and services • Fundamental shifts in technology • Incremental product innovation • Gradual improvements and refinements to existing products over time • Existing technologies are perfected • Functional managers learn how to perform value-chain activities in better ways MGMT 321 – Chapter 9

  12. Strategies to Promote Innovation and Speed Product Development • Involve both customers and suppliers • Establish a stage-gate development funnel • Establish cross-functional teams • Stage-Gate Development Funnel • Forces managers to make choices among competing projects MGMT 321 – Chapter 9

  13. A Stage-Gate Development Funnel Figure 9.7 MGMT 321 – Chapter 9

  14. Boundary-Spanning Roles MGMT 321 – Chapter 9

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