2. Value Chain Analysis
Introduction:
Every business activity is composed of number of separate tasks which
ultimately lead to value creation in terms of company’s products/
services
These activities put together in a successive sequence of value addition
we get a chain of activities called value chain
The goal of these activities is to offer the customer a level of value that
exceeds the cost of the activities, thereby resulting in a profit margin
Chain of activities starting from new material purchase to delivery of
finished products
Every activity in a chain adds some value to the product, may it be cost
cutting or value addition
A competitive advantage can be achieved by analyzing and
restructuring the value chain to provide lower cost or better
differentiation
7. Value Chain Analysis
Inbound Logistics:-
The receiving & warehousing of raw materials & their
distribution to manufacturing as they required.
Case of Tata Motors:
Long term contract with service provider’s – transporters and agents.
Transparency and monitoring through deployment of IT – all
transactions through SAP.
Efficient storage facilities – easy storage and retrieval.
9. Value Chain Analysis
Operations:-
The process of transforming inputs into finished
products/services
Apprentice Trainee Course – ensuring stable source of skilled
manpower.
Automated manufacturing processes.
Distributed manufacturing – Assembly units at South Africa, Thailand,
Bangladesh, Brazil etc.
Capacity Utilization – Mercedes Benz cars make use of Tata Motors
paint shop facilities. .
11. Value Chain Analysis
Outbound Logistics:-
The warehousing & distribution of finished goods
Stockyards, all across the country.
Long term contracts with transporter’s – higher volume of business to
transporters ensures competitive price.
Regional Sales Office and Vehicle Dispatch Section linked through
SAP.
Efficient security system for prevention of any kind of pilferage.
14. Value Chain Analysis
Marketing & Sales:-
The identification of customer needs and the generation
of sales
Clear identification of product requirements, leading to development
of innovative products – Tata 207 DI, Tata Ace
Independent teams for addressing the requirements of institutional
customers – Defense, State Transport Units
Helping to augment the scarce resources – Fiat selling vehicles
through Tata dealerships, in return Tata has access to Fiat’s
technology and unutilized capacity.
Large network of dealers
16. Value Chain Analysis
Services:-
The support of customers after the products & services
are sold to them
Easy availability of spare parts.
Efficient collection of data from field and communication to the
respective plants.
Large network of workshops – Dealer workshops and TASS.
Training facilities – for dealer
17. Value Chain Analysis
Supported By
Infrastructure:-
Organizational structure, control systems, company culture etc.
Human Resource Management:-
Employee Recruiting, hiring, T&D, Compensation
Technology Development:-
Technologies to support value creating activities
Procurement:-
Purchasing inputs like materials, supplies, equipment
18. Value Chain & Value System of TATA
motors
Inboun
d
Logistic
s
Operation
s
Marketing Servic
e
Outboud
Logistics
Suppliers , Contractors
SAP , VCM
SAP , CRM - DMS
Strategic Alliances
Transporters, Convoy
Drivers Association
Dealer Network, Marketing
Research Firms, Vehicle
Financing
Regional Warehouses,
Dealer Workshops,
Distributors, TASS
