Value Chain Organization Research Articles

Risks Of Organization's Value Chain

An organization’s management specifies planned value of the chain of activities. The outcome is affected by unpredictable, random factors, the source of which can be found both in the organization’s environment and inside it. The effect of this influence can be positive or negative which means that the chain value may be higher or lower than planned. This is a result of the effect of activities-related risks on added value generated in the organization’s functional areas.

China as a Final Market: The Gabon Timber and Thai Cassava Value Chains

Rapid economic growth in China has boosted its demand for commodities. In many commodities sectors, this has been associated with declining demand from high-income northern economies. This paper examines two hypotheses of the resulting outcomes for the organization of global value chains in general, and for the role played by low income producers in particular—the importance of standards in global value chains, and the space available for low income producers to upgrade into higher value niches in their chains. The detailed case-studies of the Thai cassava industry and the Gabon timber sector both confirm these hypotheses.

Breaking up mobile: implications for firm strategy

PurposeThis paper seeks to support and extend other scholars’ examinations of the evolution of technological modularity, vertical specialization and the concepts of the drivers of change in the basis of competition through an analysis of the evolution of the mobile phone industry.Design/methodology/approachA two‐year research project was undertaken and in‐depth interviews took place with managers at companies that were responsible for developing the value chain approaches of their firms. Companies were identified from the existing body of literature, observation and personal contact. Additionally, data were collected from developing case studies.FindingsThe paper finds that the mobile phone industry value chain is in the process of deconstructing towards more horizontally stratified structures for some device segments. But, unlike the PC industry, an industry which many analysts suggest provides a precedent for likely evolution of the mobile phone value chain, this trend will not be uniform or consistent across different product types. This will require mobile phone manufacturers to adapt their organizational structures and value chain approaches accordingly, and to rethink the basis for future competitive advantage.Research limitations/implicationsAs the research is based on interviews with a limited number of firms within the extended mobile handset industry value chain, it cannot be suggested that the impact of trends identified has equal impact for all firms.Practical implicationsMobile handset vendors should learn from the PC industry and make sure that their future strategies are not made simply on the basis of cost optimization or speed to market.Originality/valueThe paper fulfils an identified need to understand how industry structures are evolving in one of the most dynamic sectors in the world.

Global standards, global governance and the organization of global value chains

Compliance with international standards is now a sine qua non for entry into globalized production networks. Developing country firms and farms are confronted by an array of distinct product and process standards that they must meet. This has heightened the competitive challenges they face. Non-compliance can result in exclusion from profitable markets. This article uses the recent case of Nike’s termination of sourcing of soccer balls from its lead supplier in Pakistan as a lens to analyse the relationship between standards and governance. The article addresses first the global governance implications associated with how standards are being shaped and implemented. Second, it considers how global standards affect the governance of value chain ties. Finally, in terms of questions for further research, it suggests the need to explore the relationship between standards and ‘intra-firm’ governance, in particular to assess outcomes for those engaged within the chains—namely local firms and their workers, and the social contexts in which global standards are imposed from the outside.

Assessing strategic, tactical and operational alignment factors for SMEs: alignment across the organisation's value chain

Strategic alignment approaches aim to improve organisational performance, enhance efficiency and maintain or gain competitive advantage. The majority of assessment alignment approaches, however, target the strategic level and overlook the tactical and operational levels. Furthermore, most of the approaches have been tested in large organisations and little research has been conducted to investigate their effectiveness in Small and Medium Enterprises (SMEs). This paper proposes an assessment instrument that aims to understand alignment at all three levels and which has been piloted through an SME case study. The results suggest that this instrument is useful for (a) sharing the knowledge needed to achieve alignment between participants at all three levels, (b) identifying the areas where alignment strategies are weak and need further improvement, (c) identifying those areas where there is conflict between strategic, tactical and operational levels, and (d) addressing SME needs.

An Analysis of the Total Quality Movement: In Search of Quality Enhancement through Structural and Strategic Synthesis

This paper analyzes the many constructs of the total quality movement from an analytical, systems, and actors paradigmatic perspective and synthesizes the various total quality movement constructs into an effective change management planning framework. The change management planning framework developed by the author is called the Dynamic Continuous Improvement Model which synthesizes the total quality movement's elements into two specific open systems processes called morphostasis and morphogenesis. The first process called morphostasis is defined as a process that allows the organization to maintain its given form, structure, and state in an open systems environment (Bertalanffy & Rapoport, 1962a, 1962b; Peery Jr, 1972; Reed, 2006; Scott, 2003; Swenson, Malley, & Balsmeier, 1991; Tan Sen, 1994). The second process called morphogensis is defined as a process that changes the system so that it is more adaptive to environmental factors (Bertalanffy & Rapoport, 1962a, 1962b; Peery Jr, 1972; Reed, 2006; Scott, 2003; Swenson et al., 1991; Tan Sen, 1994). The Dynamic Continuous Improvement Model applies the total quality movement concepts developed during the three-way paradigmatic analysis into the two open systems constructs called morphostasis and morphogensis. The goal of the Dynamic Continuous Improvement Model is to develop process driven strategies based on both the total quality movement and open systems theory that aligns sub-systems in a manner that minimizes entropy, attains maximum throughput, and enhances quality throughout the organization's value chain.

A Transaction Structure Approach to Assessing the Dynamics and Impacts of ‘Business-to-Business’ Electronic Commerce

This paper proposes some ways forward in stimulating and structuring interdisciplinary research on business-to-business electronic commerce. A ‘commerce-centered’ perspective is proposed that is grounded in concepts of commerce as a complex socio-economic institution. On this basis, a conceptual framework is developed for assessing the dynamics and impacts of electronic commerce in the value chains of products and services. The approach focuses on examining technical change in transaction structures, and how this relates to the evolution of electronically-mediated business relationships in the rapidly developing Internet environment. The approach is oriented towards critical research questions concerning the effects of electronic commerce on the ways various market participants exercise and/or respond to control over the organization and operation of value chains, and the implications for business, the public interest and policy. The practical research possibilities of the transaction structure approach are then discussed as oriented toward a comparative analytical framework.

An Exploratory Investigation of Organizational Factors and e‐Business Motivations Among SMFOEs in the US

It is well recognized that e‐business supports all parts of an organization's value chain, and offers valuable competitive advantage to firms. SMFOEs (Small and Medium‐sized Family Owned Enterprises) represent the majority of firms worldwide and yet many have lagged in their adoption of e‐business. This paper investigates the influence of key organizational demographics, owner/manager characteristics, and organizational strategy on SMFOEs' motivations for e‐business. Eight hypotheses were formulated and tested. Characteristics found to have the greatest influence on e‐business motivation are the business strategy of the firm, new product strategy, and market scope. Owner/manager education, industry sector, and firm size were also influential, but to a lesser degree. The overall conclusion is that e‐business is in the early stages of evolution in small organizations and is favoured largely by entrepreneurial and innovative firms.

Lean viewed as a philosophy

PurposeThe purpose of this paper is to act as a meticulous conceptual paper probing the contemporary view towards lean and illustrate that, despite its discernible benefits, the implementation record suffers as the prevailing opinion fails to encapsulate that an aspiring lean enterprise shall only succeed if it views lean as a philosophy rather than another strategy.Design/methodology/approachThe paper is based on a thorough literature search concerning the success and failure of lean implementations and acts as a precursor for one of the authors utilising a combination of methodologies; namely, interviewing, survey questionnaire and participant observation in attempting to prove his PhD hypothesis.FindingsEvidently, a cocktail of factors are needed for lean success; not only is it necessary to implement most of the technical tools but an organisation's culture needs transforming too. Furthermore, the alterations need to be implemented throughout an organisation's value chain. Lean has a major strategic significance, though its implementation procedure, HRM implications, general approach to the supplier base coupled with the overall universal conviction of viewing lean as a set of tactics rather than embracing it as a philosophy advocates that this contributes to the relatively low number of successful lean initiatives.Originality/valueThe paper would prove invaluable to lean practitioners through its summation of the intricacies towards lean enterprise success and academic researchers by focusing their attention towards the necessary cultural implications.

Collective intelligence: a keystone in knowledge management

PurposeThe purpose of this article is to provide a new paradigm and a practical model whereby knowledge management may reunify the founding principles of knowledge with business challenges in organizations, such as innovation or yet customer's needs.Design/methodology/approachThe new paradigm revolves around the concept of collective intelligence. It is broken down into three blocks, each of which constitutes an aspect that needs to be taken into account while addressing a business challenge. In each case presented, these aspects have been exemplified, so as to show how they participate to the problem solving process.FindingsThe paper provides practical methods. The paper also provides information about how the approach can be applied in a great variety of domains, such as electrical engineering, health care or yet information technology.Research limitations/implicationsOpens a new field of reflection whereby the organization's knowledge, seen as representing its uniqueness, internal coherence and ability to solve everyday problems, can play a strategic role. Also, it is a reference for co‐innovation between partners, as the reciprocal integration between two sources of knowledge may be seen as a co‐adaptation between the organization's value chain and the partner's one.Practical implicationsConstitutes a real potential to develop a variety of new approaches in knowledge management, based on the concept of collective intelligence.Originality/valueThe paper brings together issues that are usually dealt with in separate domains, such as customer relationships, analysis of competencies and know how or yet innovation processes and value chains.

Cybertrust: Business partnerships increase info risk to three quarters of European companies

The finding is part of a recent Cybertrust study conducted to assess how the ‘extended enterprise’ (the network of partners, suppliers, vendors, contractors, distribution channels, etc that play a role in an organisation's value chain) has affected information risk and how security practices are evolving to meet these risks.

Enterprise risk management: A systems-thinking framework for the event identification phase

Guidelines for developing and implementing a program of enterprise risk management have been developed by the Committee on Sponsoring Organizations of the Treadway Commission. One component of this risk management program is event identification, which involves developing a list of events that could affect the ability of the enterprise to meet its strategic and operating objectives. The guidelines establish objectives for event identification and suggest general procedures for identifying events that represent business risks. In this paper, I describe how systems-thinking could provide a framework to identify events that should be considered during risk assessment by (a) creating a map of the organization's value chain that specifies relationships among the atomic components of the business model, and (b) using a taxonomy of categories to analyze those relationships and identify events that could threaten business process performance.

Intra-system competition and innovation in the international videogame industry

SummaryThis paper analyses the international videogame industry, focusing on the efficiency and effectiveness of different forms of value chain organization chosen by video console manufacturers. Customer signalling necessities and innovation requirements of the product’s system architecture are investigated in this context. To undertake this analysis, the historical development of the international videogame industry, the competitors in this industry as well as competitive forces within it are first described and evaluated. Indirect network effects characterize competition in the videogame industry. Game developers, publishers and console manufacturers invest in system-specific assets of the product. From a transaction cost perspective it is efficient to minimise the resulting coordination and hold-up problems within a vertically integrated value chain organization. However, from a strategic perspective selecting an inefficient value chain organization can be advantageous, because in certain markets coordination disadvantages are smaller than the strategic competitive advantages achieved. Competition inside a product system can increase innovation activities inside the system and thus increase the attractiveness of the whole system by leading to better components and thus competitive advantage over other product systems.

Patterns of co-alignment in information-intensive organizations: business performance through integration strategies

Information technology (IT) has transformed business practices in the last several decades: operations, product strategies, distribution, and customer service have become increasingly dependent on IT. Moreover, IT has changed its orientation from that of pure operational utility in the 1960s and 1970s to that of a competitive weapon in the 1990s and today. These phenomena have affected the way modern organizations are managed, as well as the way IT affects the strategic activities of an organization's value-chain. In particular, aligning an organization's business and IT strategies in order to deliver higher business performance presupposes a strategic business opportunity to which information systems technology is integral. In other words, Strategic Alignment between business and IT can have a positive business impact only if we see an organization's IT components as parts of a well-integrated organizational system. If business strategy is viewed separately from IT strategy or IT strategy is viewed only as a “support” tool, then there is little likelihood that the above positive impact of strategic alignment can take place. This research suggests, develops and tests a strategic co-alignment model by examining three types of integration that impact the planning process and the overall performance of information-intensive organizations: technological integration (TI), functional integration and strategic integration (SI) . The results of this research yield some useful set of guidelines for theory building for IS, as well as for the business practice aspect of IS: most interesting is the role of consistency (co-alignment) between an organization's business and strategic information systems plans to improve overall firm performance. Other recommendations include having a high degree of involvement of IS executives in corporate planning, the use of outsourcing services to promote organizational systems integration, and the importance of internal coordination mechanisms to facilitate both systems consistency and lower transaction costs. Finally, this study has employed cluster analysis and discriminant analysis to interpret the research findings.

Performance measurement for public sector organisational transformation

This paper discusses the importance of performance measurement for Organisational Transformation in the Singapore public sector and its relation to meeting the expectations of the key stakeholders. The paper also presents an effective Performance Management Framework and suggests a useful step-by-step guide in developing a performance measurement framework system. Organisational transformation is the process of bringing an organisation from the current state to the future state that enables them to embrace the challenges of ever-changing environment and increasing customer demands. Customer, Owner and Employee (COE) – the tripartite partnership is the key principle behind the performance measurement framework. COE conceptualises the organisation's value chain and helps formulate the key performance indicators. The performance measurement framework encompasses the macro planning which defines the mission and strategic outcomes to micro planning which determines the tactical/operational measures for each value chain process. It also highlights the importance of input, process, output and outcome (IPOO) measures. Within this value chain, eight Key Result Areas (KRAs) have been identified. They are: quality of work; employee development; innovation; effectiveness; efficiency; quality of products/service; productivity; and customer satisfaction. The approach of this framework is demonstrated through study using the six steps approach.

The Boundaryless organization: breaking the chains of organizational structure

A New World Order: Rising to the Challenge of New Success Factors. Stepping up to the Line: How Boundaryless is Your Organization? FREE MOVEMENT UP AND DOWN: CROSSING VERTICAL BOUNDARIES. Toward a Healthy Hierarchy. Stepping Up to the Line: How Healthy is Your Organization's Hierarchy? Rewiring and Returning the Hierarchy. FREE MOVEMENT SIDE TO SIDE: CROSSING HORIZONTAL BOUNDARIES. Beyond Turf and Territory. Stepping up to the Line: How Congruent are Your Organization's Horizontal Boundaries? Integrating Resources to Serve the Customer. FREE MOVEMENT ALONG THE VALUE CHAIN: CROSSING EXTERNAL BOUNDARIES. Toward Partnership with Customers and Suppliers. Stepping Up to the Line: How Well Linked is Your Organization's Value Chain? Strengthening the Value Chain. FREE GLOBAL MOVEMENT: CROSSING GEOGRAPHIC BOUNDARIES. Toward the Global Corporation. Stepping up to the Line: How Far Along the Path to Globalization is Your Organization? Actions for Global Learners, Launchers, and Leaders. CONCLUSION. Making it Happen: Leading Toward the Boundaryless Organisation. Stepping up to the Line: Are You a Boundaryless Leader?

Recent IDF publications

The rapid advances of information technology have pushed society into the fourth industrial revolution (I4.0). It requires an integration of value chain organization and management across the product lifecycle driven by the Internet industrialization, industrial digitalization and intellectualization, and industrial integration. PLM is the business activity of managing a company’s products from the idea of product development to the end of product life. It aims to seamlessly manage all products, information, and knowledge generated throughout the product’s lifecycle in order to achieve business competitiveness. Blockchain is an emerging technology that brings transparency to opaque systems, verifiability, and immutability to transactions and processes, which gives it the potential to drive I4.0 revolution. This chapter will demonstrate the real-world applicability of blockchain potential using existing industrial case studies. Besides, an industrial blockchain-based PLM framework is introduced to facilitate data exchange and service sharing in the product lifecycle.