Page 13 - CIMA OCS August 2018 Day 2 Tasks

Chapter 9

ORGANISATIONAL MANAGEMENT

(E1) PRACTICE TASKS

EXERCISE 1 (VALUE CHAIN)

TRIGGER

This morning you find the following note on your desk.

Note from Rav Shah (Operations Director)

At yesterday’s board meeting we discussed the contribution of operations management to the
efficient production and delivery of fit-for-purpose goods.

One thing Fred and Nina are keen to explore is the how our company’s activities contribute
towards its competitive advantage. This immediately threw me back to my university days when I
was learning about Porter’s value chain!

No sooner than I thought of the value chain concept, had I volunteered to present to the board on
this topic at our follow-up meeting. I would like your help with this please. Amongst other things,
I will be making suggestions which will help managers to decide how individual activities might be
changed to reduce the costs of operations or to improve the value of the organisation’s offerings.

Please prepare some briefing notes which briefly explain the concept of Porter’s value chain in a
way that is easily understood by those who are unfamiliar with technical jargon. Then please go
on to break Thomas Fine Teas down into its five ‘primary’ and four ‘support’ activities by
describing how the company carries out each activity. I would appreciate your comments as to
whether you believe each activity is adding value, perhaps in terms of cost or quality, to our
business.

Human resource management and procurement were hot topics at yesterday’s board meeting, so
if you have suggestions as to how we can improve our activities in those two ‘support’ areas for
the benefit of the company’s competitive advantage then I would be delighted to hear them.

Thank you for your assistance with this.

TASK

Respond to Rav Shah’s request.
(Time allocation: 30 minutes)

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