Page 483 - Fundamentals of Management Myths Debunked (2017)_Flat

482 Part 5 • Controlling
Exhibit 15–2 Requirements for Successful Value Chain Management

Organizational Coordination
Culture and and
Attitudes Collaboration

Value
Employees Chain Technology
Strategy Investment

Organizational
Leadership
Processes

What Are the Requirements for Successful

Value Chain Management?
So what does successful value chain management require? Exhibit 15–2 summarizes the six
main requirements. Let’s look at each of these elements more closely.

(1) CoordInatIon and CollaboratIon. For the value chain to achieve its goal of
meeting and exceeding customers’ needs and desires, comprehensive and seamless integra-
tion among all members of the chain is absolutely necessary. All partners in the value chain
must identify things that they may not value but that customers do. Sharing information
Coca-Cola’s CEO Muhtar Kent (at right) is and being flexible as far as who in the value chain does what are important steps in build-
shown here with officials of the firm’s bottling
partner Coca-Cola Hellenic at a new plant ing coordination and collaboration. This sharing of information and analysis requires open
opening in Russia. Kent and other company communication among the various value chain partners. For example, Furon Company, a
managers are strongly committed to leading manufacturer of specialty polymer products, believes that better communication with cus-
the firm’s global value chain from producers
of agricultural ingredients to bottling partners tomers and with suppliers has facilitated timely delivery of goods and services and opened
and retailers. up additional business opportunities for all its value chain partners. 23

ZUMA Press, Inc./Alamy
(2) teChnology InvestMent. Successful value
chain management isn’t possible without a significant
investment in information technology. The payoff
from this investment is that information technol-
ogy can be used to restructure the value chain to
24
better serve end users. For example, Rollerblade,
Inc., invested heavily in developing a Web site and
used it to educate customers about its products.
Although the company has chosen not to sell its
products over the Web for fear of antagonizing
its dealer network, managers remain flexible
about the issue and would reconsider if they
felt that value could be better delivered to cus-
tomers by doing so. 25
What types of technology are important?
According to experts, the key tools include a
supporting enterprise resource planning soft-
ware (ERP) system that links all of an organi-
zation’s activities, sophisticated work planning
and scheduling software, customer relationship