final ppt of business policy1(3)
TRANSCRIPT
-
8/8/2019 Final Ppt of Business Policy1(3)
1/23
irtual value chain:y
NithyanandHemanth
Kalyan
ChandraAnil
-
8/8/2019 Final Ppt of Business Policy1(3)
2/23
alue chainThis value chain begins with the content
,supplied by the provider which is thendistributed and supported by the information
infrastructure thereupon the context provider
.supplies actual customer interaction
-
8/8/2019 Final Ppt of Business Policy1(3)
3/23
VC model treats information only as a supportingelement
irtual value chain
ut information itself can be a source of value
,An extension of the conventional value chain-where the information processing itself can.create value for customers
: ,Example dell Geffen records
-
8/8/2019 Final Ppt of Business Policy1(3)
4/23
-
8/8/2019 Final Ppt of Business Policy1(3)
5/23
-e commerce and newspapers
Banks provide services to customers at branch office inthe marketplace as well as electronic online services to
.customers in the marketspace
Airlines sell passenger tickets
EXAMPLE
-
8/8/2019 Final Ppt of Business Policy1(3)
6/23
Just as someone takes raw materialand refines it into something useful
as in the sequence of tasksinvolved in assembling anautomobile on a production line so
a manager today collectsraw
information and adds value throughthese steps.--(Rayport and Sviokla
)
REATING VALUE IN VVC
-
8/8/2019 Final Ppt of Business Policy1(3)
7/23
Involves:Information
.1 Gathering info
.2 Organizing info.3 Selecting info
.4 Synthesizing info
.5
Distributing info
reating value in vvc
-
8/8/2019 Final Ppt of Business Policy1(3)
8/23
1.Visibility: improve the ability totrack physical operations more
effectively2.Mirroring capability: substitute
virtual activities for physicalones
3.Create new customerrelationships: use info todeliver value to customers in
new way
-hree stages of valuedding informationalprocesses
-
8/8/2019 Final Ppt of Business Policy1(3)
9/23
Visibility is where businesses co-ordinate, measureand sometimes control business processes.Over the last 30 years, information systems havebecome powerful tools in management of the physical
value chain.improve the ability to track physical operations moreeffectively.
Example: Frito-Lays info revolution initiativeInfo technology allows managers to see or trackoperations more effectively
Visibility
-
8/8/2019 Final Ppt of Business Policy1(3)
10/23
Employees in field collect info on sales of products dailyand feed it to co.Field employees collect store info about sales and promoof competing and new products
Frito-Lay continuously optimizes, reducing inventory andsupplier risk, planning truck routing technology andinformation are playing a support role only when visibilityis improved.
How does Frito-Lay do it?
Visibility
-
8/8/2019 Final Ppt of Business Policy1(3)
11/23
-
8/8/2019 Final Ppt of Business Policy1(3)
12/23
Example: Fords virtual design team
Testing of prototypes in simulatedenvironments with colleagues over a
computer network around the worldSuppliers are drawn into the design process
Mirroring capability
-
8/8/2019 Final Ppt of Business Policy1(3)
13/23
Every manager knows that staying competitive today dependson achieving higher levels of performance for customers whileincurring lower costs in R & D and productionOn the VVC,companies may find dramatic low-cost approaches to deliveringextraordinarily high-value results to customers
Mirroring may move customers from the place to the spaceExample: eCommerce
Example: Online customer serviceExample: Email marketingExample: Online course registrationExample: Online surveys
Mirroring capability
-
8/8/2019 Final Ppt of Business Policy1(3)
14/23
reate new customerrelationshipsBusinesses present value to the customer by new meansand in new fashions. IT creates value in the marketspace.The new relationship between business and customer isstrongly based on using IT.
:ackage trackingEstablishing sites on the World Wide Web to
advertise products or elicitcomments from customers
-
8/8/2019 Final Ppt of Business Policy1(3)
15/23
It is important to note that the PVCand the VVC are distinctly different.
The physical value chain is
composed of a linear sequence ofactivities with defined points ofinput and output. By contrast, the
virtual value chain is non-linear amatrix of potential inputs andoutputs that can be accessed anddistributed through a wide varietyof channels.
Implications
-
8/8/2019 Final Ppt of Business Policy1(3)
16/23
,By implementing a virtual value chain a company could:inherit the following aspects
he law of digital assets , ,Digital assets unlike physical ones are not used up
.in their consumption Companies that create value-with digital assets may be able to re harvest themthrough a potentially infinite number of
,transactions thus changing the competitive dynamics.of their industries
The variable cost of creating value using digital
information assets is zero or close to it
ew economies of scale The virtual value chain redefines economies of
,scale allowing small companies to achieve low unitcosts for products and services in markets dominated
.by big companies
ew economies of scope ,In the marketspace businesses can redefine
economies of scope by drawing on a single set ofdigital assets to provide value across many
.different and disparate markets
-
8/8/2019 Final Ppt of Business Policy1(3)
17/23
-ransaction cost compression Transaction costs along the VVC are lower than their
,counterparts on the PVC and they continue to decline.sharply Lower transaction costs allow companies to
control and track information that would have beentoo costly to capture and process just a few years.ago
-e balancing supply and demand ,Taken together these four axioms combine to create
:a fifth the world of business increasingly demands- - .a shift from supply side to demand side thinking" " Companies must sense and respond to customers
desires rather than simply make and sell products.and services
-
8/8/2019 Final Ppt of Business Policy1(3)
18/23
Dr. Stephen C. Hayne
Increasing Value in theChain
Supplier Value
incremental sales
speed info flow
customer statistics product feedback
channel knowledge
lead effectiveness
C u sto m e r V a lu ep rice a n d
a v a ila b ility
lo w e r tra n sa ctio ncost
/p re p o st sa le s
support
n e w p ro d u ct
kn ow le d g e
p ro d u ct in te g ra tio n
cu sto m e r le a d s
-
8/8/2019 Final Ppt of Business Policy1(3)
19/23
Dr. Stephen C. Hayne
Virtual Value Chain
In b ou n d
Lo g istics
O p e ra tio
n s
O utb ou n
d
Lo g istics
/M rktin gS a le s
S e rvice
G
ath
er
O
rgan
iz
e
Se
lec
t
Sy
nt
h
e
siz
e
D
is
tr
ib
u
te
P h y sica l
-
8/8/2019 Final Ppt of Business Policy1(3)
20/23
Dr. Stephen C. Hayne
Evolution of WebApplications
Public Relations (vanity?)
Product Advertising
Information Publishing
Customer Communications(discussion groups?)
Electronic Commerce (EDI/Webtransactions)
Leveraging Knowledge
-
8/8/2019 Final Ppt of Business Policy1(3)
21/23
Dr. Stephen C. Hayne
Business and the Web
No Internet = No Business (liketelephone)
Companies with poor connectivitywill resemble a 40-year-old tryingto win Wimbledon with a wooden
racket...
-
8/8/2019 Final Ppt of Business Policy1(3)
22/23
Some examples
-
8/8/2019 Final Ppt of Business Policy1(3)
23/23