Assessing the Assessing the Primary and Primary and

Support Activities Support Activities in the Value Chain in the Value Chain

ApproachApproachDr.Kedar KarkiDr.Kedar Karki

INBOUND LOGISTICSINBOUND LOGISTICS

• Is there a materials control system? How well does it work?

• What type of inventory control system is there? How well does it work?

• How are raw materials handled and warehoused?

• How efficiently are raw materials handled and warehoused?

OPERATIONSOPERATIONS

• How productive is our equipment as compared to our competitors?

• What type of plant layout is used? How efficient is it?

• Are production control systems in place to control quality and reduce cost? How efficient and effective are they in doing so?

• Are we using the appropriate level of automation in our production processes?

OUTBOUND LOGISTICSOUTBOUND LOGISTICS

• Are finished products delivered in a timely fashion to customers?

• Are finished products efficiently delivered to customer?

• Are finished products warehoused efficiently?

MARKETING AND SALESMARKETING AND SALES

• Is marketing research effectively used to identify customer segments and needs?

• Are sales promotions and advertising innovative?

• Have alternative distribution channels been evaluated?

• How competent is the sales force? Is their level of motivation as high as it can be?

MARKETING AND SALESMARKETING AND SALES

• Does our organization present an image of quality to our customers?

• Does our organization have a favorable reputation?

• How brand loyal are our customers? Does our brand loyalty need improvement?

• Do we dominate the various market segments we are in?

CUSTOMER SERVICECUSTOMER SERVICE

• How well do we solicit customer input for product improvement?

• How promptly and effectively are customer complaints handled?

• Are our product warranty and guarantee policies appropriate?

• How effectively do we train employees in customer educations and service issues?

• How well do we provide replacement parts and repair services?

THE SUPPORT ACTIVITIES THE SUPPORT ACTIVITIES IN THE VALUE CHAININ THE VALUE CHAIN

• PROCUREMENT• Have we developed alternate source

for obtaining needed resources?• Are resources procured in a timely

fashion? At lowest possible cost? At acceptable quality level?

PROCUREMENTPROCUREMENT

• How efficient and effective are our procedures for procuring large capital expenditures resources such as plant, machinery, and buildings?

• Are criteria in place for deciding n lease-versus-purchase decisions?

• Have we established sound long-term relationship with reliable suppliers?

TECHNOLOGY TECHNOLOGY DEVELOPMENTDEVELOPMENT

• How successful have our R&D activities been in product and process innovations?

• Is the relationship between R&D employees and other departments strong and reliable?

• Have technology development activities been able to meet critical deadlines?

TECHNOLOGY TECHNOLOGY DEVELOPMENTDEVELOPMENT

• What is the quality of our organization’s laboratories and other research facilities?

• How qualified and trained are our laboratory technicians and scientists?

• Does our organizational culture encourage creativity and innovation?

HUMAN RESOURCES HUMAN RESOURCES MANAGEMENTMANAGEMENT

• How effective are our procedures for recruiting, selecting, orienting, and training employees?

• Are there appropriate employee promotion policies in place and are they used effectively?

• How appropriate are reward systems for motivating and challenging employees?

HUMAN RESOURCES HUMAN RESOURCES MANAGEMENTMANAGEMENT

• Do we have a work environment that minimizes absenteeism and keeps turnover at reliable levels?

• Are union-organization relations acceptable?• Do managers and technical personnel

actively participate in professional organization?

• Are levels of employee motivation, job commitment, and job satisfaction acceptable?

FIRM INFRASTRUCTUREFIRM INFRASTRUCTURE

• Is our organization able to identify potential external opportunities and threats?

• Does our strategic planning facilitate and enhance the accomplishment of organizational goals?

• Are value chain activities coordinated and integrated throughout the organization?

• Can we obtain relatively low-cost funds for capital expenditures and working capital?

FIRM INFRASTRUCTUREFIRM INFRASTRUCTURE• Does our information system support

strategic and operational decision making?• Does our information system provide

timely and accurate information on general environmental trends and competitive conditions?

• Do we have good relationships with our stakeholders including public policy makers and interest groups?

• Do we have a good public image of being a responsible corporate citizen?

Value Chain Transformation Three Phase Approach

• Phase 1: Framing and ScopingThis 1-2 week effort is designed todefine the vision, goals, and scopeof the effort, and build the teamstructure, roles, and governance forthe Analysis and Design phase

Phase 2:Analysis and DesignAnalysis and Design

• This 7-8 week process rapidly engages the organization to develop detailed understanding of the current value chain and the improvement opportunities that exist. Conceptual to-be processes and operating modules are developed and supported by a process simplification roadmap, deployment plan, and business case. A time-phased implementation program is then developed summarizing the work streams required to most aggressively transform the value chain.

Phase 3: Pilot & Phase 3: Pilot & ImplementationImplementation

• The implementation process is typically a time-phased effort involving multiple streams of work, multiple teams, and many project activities that require lean, Dfss, six sigma, Innovation, and supply Chain skill sets. Detailed solutions are planned, piloted, and implemented. The required policy, process, people, and technology changes are executed, measured for success, and made sustainable with proper controls so that improvement benefits are permanent.

Why is our approach so Why is our approach so successful?successful?

• We work hand-in-hand with our clients to: Jointly develop a strategic path forward to achieve a quantified, validated business case

focus efforts on the highest impact, strategically aligned, opportunities .Mobilize your company for change by involvement at all levels within the organization Address the rational, political, and emotional change levers in the organization .Assess the impact of technology … today and in the future

To ensure successTo ensure success• Involve a multi-function group of

people to ensure success :• Executive Sponsor • Value Chain Steering Committee• Functional Area and Site Leads • Functional Area and Site Support

Team• Subject Matter Experts

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