From Supply Chain to Value Chain – The Axia Institute Approachmifbi.org/wp-content/uploads/2019/02/AXIA_From... · research projects The Axia Institute The Axia Institute Operating

| The Axia Institute: Delivering Value Chain Solutions® Michigan State University |

February 12, 2018

From Supply Chain to Value Chain –

The Axia Institute Approach

John D. Hatfield

Director of Marketing and Communications

| The Axia Institute: Delivering Value Chain Solutions® Michigan State University | 2

Agenda

Topic

The Axia Institute Operating Model

The Axia Institute Mission and Vision

Value Chain

Examples

Questions


Value chains encompass the

complete life cycle of a product.

The Axia Institute helps firms

address some of the industry’s

greatest challenges by providing

high-impact solutions.

• #1 ranked Supply Chain

Management program

• Leading value chain innovation

center

• Institute model to help facilitate

faculty research and company

collaboration

• Open/consortia or proprietary

research projects

The Axia Institute The Axia Institute Operating Model

The Axia Institute provides a neutral environment to foster collaboration and an integrated systems approach to value chain optimization.

MULTIDISCIPLINARY APPROACH:Delivering

comprehensive solutions

with

input from

across

functional

areas

INDUSTRY PARTNER:

Solving grand

challenges

through

collaborative

and applied

research

EXPERIENTIAL ENGAGEMENT HUB:Deepening

expertise

through

capstone

projects

KNOWLEDGE NEXUS:

Bridging the gap

between theory

and practical,

real-world

solutions

Value ChainCenter of Excellence

The Axia Institute Operating Model


• Pioneering tomorrow’s solutions

• Fostering private/public partnerships

• Enabling multi-disciplinary collaboration

Research

• Executive education programs

• Experiential learning

• Student internships

• Executive retreats and forums

• Innovative solutions

• Value Chain Excellence Index

Education Outreach

We are the top-of-mind center of excellence, leading the world in high-

impact solutions to revolutionize value chains.

The Institute provides world-class research, teaching programs and

outreach that make business happen.

Vision Mission

+ +

The Axia Institute Breakthrough Approach


Chain Solutions

• Value Chain Index

• Automated SC Management

Using Machine-Learning-

Based Tariff Classification

and Optimized International

Trade Compliance

Smart Packaging

• RFID Sensing for

Tracking and Sensing

Packaging

• Printing RFID Sensors

• Product Authentication

and Anti-Tampering

•Multi-Factor Intelligent

Packaging Solution to

Prevent Opioid Abuse

and Misuse

Risk Mitigation

• Nano-Bioelectric Technique for Novel

Microbial Intervention in Packaged Food

MSU Expertise

Industry Needs

Priority Value Chains

Research Grand Challenges


The evolution of value creation from supply chain to integrated value chain:

• Single company integrated supply chain model

• End-to-end integrated supply chain model

• Single company integrated value chain model

• End-to-end integrated value chain model

6

Value Chain Creation: Chronological History

End-to-end integrated value chain management provides firms with the next transformational opportunity for value creation.

ProcessingRaw Materials Manufacturing Distribution Retail

VA

LU

E

VA

LU

E

VA

LU

E

Consumer

VA

LU

E


Extending the firm’s focus from supply chain to integrated value chain management:

• From product focus to solution focus

• From cross-functional focus to an integrated scalable model

• From single company focus to multi-company focus

• From technology project focus to full-scale multi-company digitization

• From customer focus to consumer focus

Consumer

7

Integrated Value Chain Management

ValueValue

ValueValue

ValueValue

ValueValue

Cost, Health, Ease of Use, Emotional Influence, Reliability, Social Impact

RetailDistributionProcessing

Integrate, End-to-End Value Chain

Manufacturing

ValueValueRaw Materials


Value Chain Competencies

Talent Management:

Business unit capabilities to manage and develop human capital across the integrated value chain.

Supplier Integration:

Business unit capabilities to assure supplier capabilities are understood for improved value chain performance across both companies.

Risk Management:

Business unit capabilities to manage and implement value chain risk management to improve and maintain integrated value chain performance.

Internal Integration:

Business unit capabilities focused on cross-functional structure and best practice procedures to help the company quickly adapt and respond to customer demand and external market changes.

Integrative and Digital Technologies:

Business unit capabilities to facilitate information sharing by value chain partners to increase value chain visibility and analytics opportunities.

Innovation:

Business unit capabilities to promote cross business unit value chain innovation, and exchange intellectual property with value chain partners.

Customer Integration:

Business unit capabilities to assure customer needs are understood in order to quickly respond to rapidly changing customer needs.


Value Chain Competencies

Talent Management:Business unit capabilities to manage and develop human capital across the integrated value chain.

Supplier Integration:Business unit capabilities to assure supplier capabilities are understood for improved value chain performance across both companies.

Risk Management:Business unit capabilities to manage and implement value chain risk management to improve and maintain integrated value chain performance.

Internal Integration:Business unit capabilities focused on cross-functional structure and best practice procedures to help the company quickly adapt and respond to customer demand and external market changes.

Integrative and Digital Technologies:Business unit capabilities to facilitate information sharing by value chain partners to increase value chain visibility and analytics opportunities.

Innovation:Business unit capabilities to promote cross business unit value chain innovation, and exchange intellectual property with value chain partners.

Customer Integration:Business unit capabilities to assure customer needs are understood in order to quickly respond to rapidly changing customer needs.


Assess an organization’s ability to compete with these value chain cultural competencies:

• Customer integration

• Integrative and digital technologies

• Innovation

• Internal integration

• Risk management

• Supplier integration

• Talent management

Assess which competences are driving directional changes for these outcome variables:

• Cost

• Quality

• Customer Responsiveness

• Speed to Market

Integrative and Digital Technologies

Customer Integration

Innovation

Internal Integration Risk Management

Supplier Integration Talent Management

10

Value Chain Capability and Performance Indicators

Value Chain Culture

Cost Quality

Customer Responsiveness

Speed to Market


8-WEEK COURSE – $2,500

Overview & Customer Value

Trends & Implications

SCODE Simulation

Procurement

Sales & Operation Planning

Logistics & Network Design

Anti-Counterfeiting, Brand Protection

Sustainability & Risk Management

SCODE Simulation & Conclusions

ATTENDANCE

Spring 2019 – Registration Open

Tuesdays, April 23 – June 11, 2019

Mid-Michigan Value Chain Certificate Program


Value Chain Certificate Program – Testimonials


2017 Value Chain Summit


Sources: USDA, UN FAO, IBISWorld, Crean, Big Six, Gordon, R.

Target Customers: Trader Joe’s, Sysco, Dole, Chiquita, C.H. Robinson, Fresh Del Monte, Premium Fresh, O Organic, Nature’s Basket, Natural Selection Foods, Fresh Point, Green Harvest

Wrapping Bags – Customer useWrapping

Fruits and Vegetables Implementation Pathway

• Understand our expertise, mission, and goals:Packaging

• Define the industry or customer problem:Food waste

• Understand the flow of goods, money, information, etc.:Flow of product

• Understand the value to be created:Reduce waste generated

• Focus on areas with a fit for potential solutions:Wrapping and bags for customer use

Methodology

14


Pharma Value Chain

Source(s): IMS Institute, Statista, The U.S. Department of Health & Human Services, U.S. Senate Committee on Finance, Minority Staff, IQVIA.

Example: Pharma Value Chain

• Innovation

• Regulatory documentation

• Quality assured manufacturing

• Education

• Continuous supply

• Waste management

• Order processing

• Education

• Medicine availability

• Pharmacist advice

• Patient convenience

• Health services

• Education

• Negotiated volume discounts

• Manufacturer rebates

• Formulary placement

PLAYER

VALUE ADDED

$ GROSS REVENUE 23.90B – – – –

17.47B 22.31B 21.77B 4.45B 23.93B$ NET REVENUE

7.36B 543.52M 1.08B 976.23M 1.03B$ PROFIT

Manufacturer WholesalerRetail (Pharmacy,

Online, Other)Non-Retail

Payor (PBM/Insurance)

Patient

15

27.23B

10.99B

CHAIN TOTALS

QUESTIONS?

Thank you.

Documents

From Supply Chain to Value Chain – The Axia Institute Approachmifbi.org/wp-content/uploads/2019/02/AXIA_From... · research projects The Axia Institute The Axia Institute Operating