Controlling

Carla J. McCoy

Unit 5 Discussion Board – MGT240

March 12th, 2009

American InterContinental University

Introduction

There is no doubt that Organizations face competitive markets which is good because

Organizations from all over the world need to practice continuing process for improvement if

they want to evolve and maintain profits. (Crowley, M., Unit 5 Live Chat Session 2009) There

are requirements that need to be put to work in order for this process to work though which will

be described in detail throughout this article. You will be able to see in this article how the ABC

Microchip Company can take the 6 Value Chain Management requirements and put them to

work in order for the Organization to remain competitive in the long run. (AIU Online, 2009)

Putting Requirements to Work to remain Competitive

The pressures of Competitive forces such as the makers of “clone” microchips will

enhance product changes by shortening product and technology development lifecycles.

Knowledge is important to have and is different from industrial resources. It can be in more than

one place at one time, and may be permanent or time sensitive. Knowledge has been expressed

and transferred in various ways such as through recorded experiences, materials for education,

statistics, collections, lectures, training, rules, policies, expert systems, and diagrams. Intellectual

capital can be put to use to create wealth but if you can’t measure it you can’t manage it. (Author

Stream, 2007)

When looking at Value Chain Management, Preservation is another key to success here

where knowledge is captured and inventoried, Organized and Mapped, Stored with Capacity, can

be retrieved through Access, and be maintained with Continuity by Management. (Author

Stream, 2007) The ABC Microchip Company could use Coordination and Collaboration by

making sure that collaborative relationships exist among all chain participants. Each Partner

within the ABC Microchip Company needs to identify valuable things like their customers do.

Being flexible and sharing information is an important part of Coordination and Collaboration

because it matters who within the corporation is doing what. This requires chain partners to have

better open communication skills. If the ABC Microchip Company had better communication

not only with it’s customers but with chain partners and suppliers as well it would facilitate a

good timely delivery of goods and services. (Robbins, S., & Coulter, M., 2007)

One thing that is very common among Organizations is if you take two Organizations in

the same industry that is selling the same “type” of products, neither one of them will have the

same strategy towards the customer. Here’s a good example: Take a look at ABC Microchip

Company vs. DEF Microchip Company. ABC Microchip Company will sell PCs whose

configuration corresponds to specifications that are given by the customer when they place

orders such as (Intel Pentium Pro, 32M of Ram, etc…) This Organization has high expectations

of its parts suppliers to be very reactive because they want to satisfy the customer. The DEF

Microchip Company however sells PCs based on what the availability is in stock and do not

assemble PCs due to individual demand. This company will always have a large stock of PCs

that are already built and won’t have much reactivity from their parts suppliers. This company

however doesn’t show very much flexibility towards the customer like ABC Microchip

Company does. (Infolab.stanford.edu, 1998)

Another requirement the ABC Microchip Company would need to maintain in order to

remain competitive would be their Technology Investment because it isn’t possible to have a

successful value chain management without it. This can be used to restructure the value chain. If

the ABC Microchip Company has a good comprehensive IT Department that has a good strategy

and extends globally, this would significantly improve work progress which will serve end users

quite nicely. (Robbins, S., & Coulter, M., 2007) One thing the ABC Microchip Company might

consider when it comes to Technology Investment is to review the Stages of Maturity which are:

1). Creating investment awareness. This would involve spending without disciplined investment

processes. 2) Building the investment Foundation. This would involve meeting business needs,

selecting an investment, and providing investment oversight. 3) Developing a complete

investment portfolio which would involve Creating, Evaluating, Defining and Conducting

Portfolio Criteria as well as conducting post implementation reviews. 4) Improving the

investment process which would be to improve performance and making sure to manage the

succession of information systems. 5) Leveraging IT for strategic outcomes would involve

optimizing the investment process and using IT to drive strategic business change. (Highlights of

GAO, 2004)

Organizational Processes are also required and should be radically changed by

management when they decide to manage operations using value chain management by getting

rid of old processes no longer appropriate and creating new ways that organizational work is

done. ABC Microchip Company needs to plan and carefully work out all applied processes.

Organizational processes require many questions that need to be answered for each and every

process when it is critically being evaluated from beginning to end in order to see where value is

being added. Better demand forecasting will be required at ABC Microchip Company and will

be possible due to closer ties with customers as well as suppliers. Selected Functions will need to

be done collaboratively among other partners and extend to employees. And finally there are

new Measures being evaluated for performance of various activities along the value chain. ABC

Microchip Company’s goal is to meet and exceed customer needs and desires and Managers are

in need of better ideas on how well this value is being created and delivered to its customers in

order for the end result of the organizational process an Organization or a whole that consists of

unified parts that act together in harmony to achieve goals and execute tasks efficiently and

effectively. (Robbins, S., & Coulter, M., 2007)

ABC Microchip Company would not have successful value chain management if it didn’t

have strong committed leadership. Serious commitment among Managers in all organizational

levels needs to identify what value is whether they are in the top organizational levels or lower

levels. They must facilitate, support, and promote the implementation and ongoing practice of

value chain management. They also need to identify how value can be provided as well as how

successful their efforts have been. Commitment among the organizations leaders must be evident

in order for efforts to be focused on delivering superb customer value. An outline of expectations

is good for the organization to have which begins with a vision or mission statement that will

express the organizations commitment to providing , capturing, and identifying the highest

possible value to customers. After expectations have been set they need to be clarified regarding

each employees role in the value chain. If the ABC Microchip Company can obtain Managers,

and employees who are capable of interacting through various methods of strategic planning and

innovation, they will also be able to use Organizational Diagnostic tools and interventions.

Decision making, creativity, problem solving, strategy, and various analytical methods are all

part of this process. Employees are the ABC Microchip Corporations best resources because

without them there would be no products, services, nor organized efforts for common goals.

(Robbins, S., & Coulter, M., 2007)

The three main Human Resource Requirements for value chain management are ongoing

training, having an effective hiring process and flexible approaches to job design and flexible

employees. There are traditional functional job roles that the ABC Microchip Company can

employee and properly train people in departments such as customer service, marketing,

accounts payable, and sales are inadequate in value chain management because the design of

jobs must be designed around work processes in order to create and provide value to customers.

Employees may be assigned to work in teams that will tackle processes given on different days

or in different areas depending on the needs of the organization and may end up having to do

Delegations. The Organizational hiring process has to be designed to identify people who have

the ability to learn and adapt so that customer value is best delivered through collaborative

relationships. Employee Training is vital when it comes to the need for flexibility and significant

investment and must have the knowledge and tools they need to do their jobs effectively and

efficiently. There are some benefits to Value Chain Management which are Improved Customer

Service, Increased Market Share, Improved Logistics Management, Improved Quality, Cost

savings, Inventory Reductions, Accelerated delivery times, and Increased Sales and this is from

sharing information with partners. Of course there are downsides to Value Chain Management

also which would be Organizational Barriers which would be to include or refuse in sharing

information. Cultural Attitudes which involves either too much trust or lack of. Intellectual

Property involves a loss of control among the collaboration results. (Robbins, S., & Coulter, M.,

2002)

Having a Supportive Organizational Culture as well as Attitudes must include

collaborating, openness, mutual respect, sharing, flexibility, and trust. Having this will

encompass internal partners but extend to external partners as well. People have to be flexible

and be able to configure products to satisfy customers as well as the ability to educate internal

and external partners. (Robbins, S., & Coulter, M., 2007)

Conclusion

There are Inputs and there are Outputs to the Operations System among Operations

Management which are vital to the ABC Microchip Company because they produce physical

goods, and produce nonphysical outputs in the form of services which carries over into

Managing Productivity. The Inputs of the Operations system is People, Capital, Equipment,

Materials, Technology, and Information which transforms over to outputs of having Goods, and

Services. Value Chain Management in comparison to Operations Systems is provided through

raw materials into products and services that customers need when, where, and how they want it.

After reviewing all the information provided here, you can see that the ABC Microchip

Company has recognized that customers are the ones with power, the sequence of team work

within the Organization among various departments has fully worked together as a team, there is

better collaboration among chain participants and that a value chain strategy meets and exceeds

all of it’s customer’s needs. (Robbins, S., & Coulter, M., 2002)

References

AIU Live Chat Session:

Crowley, M., (2009) Controlling American InterContinental University Unit 5 Live Chat Session

#1, Held on March 11th, 2009 retrieved on March 12th, 2009 at https://mycampus.aiu-

online.com

AIU MGT240 Classroom:

AIU Online, (2009) Controlling American InterContinental University Unit 5 Classroom

Assignment, retrieved on March 12th, 2009 at https://mycampus.aiu-online.com

AIU Online eBook:

Robbins, S., Coulter, M., (2007) Management (9th ed.). N.J. Pearson Prentice Hall. (pg. 569-

573). Retrieved March 12th, 2009 at https://mycampus.aiuonline/MainFrame.aspx?ContentFrame=/Default.aspx

Robbins, S., Coulter, M., (2002) Management (7th ed.) Prentice Hall. (Chapter 19) Retrieved on

March 12th, 2009 at http://202.201.252.228/newjpkt/kejian/07glx/kejian%20e/chap19.pdf

Online PowerPoint Presentation:

Author Stream, (2007) Knowledge Management Value Chain Presentation retrieved on March

12th, 2009 at http://www.authorstream.com/presentation/stone-595-knowledge-

management-value-chain-canada-land-cover-climate-change-chains-12982-others-

miscellaneous-powerpoint/

Online Executive Guide:

Highlights of GAO, (2004) A Framework for Assessing and Improving Process Maturity The

United States General Accounting Office Executive Guide Version (1.1) retrieved on

March 12th, 2009 at http://www.gao.gov/new.items/d04394g.pdf

Infolab.stanford.edu, (1998) Supply Chain Management retrieved on March 12th, 2009 at

http://infolab.stanford.edu/CHAIMS/Doc/Details/AppDomains/SCM/scm.html