Export Planning
How to write an international marketing plan
Chapter 5: Value chain and supply chain setup
Internationalisation of the firm
Export Planning
Institute _II_BPM
Joris Leeman© , 2010
Export Planning
Institute _II_BPM
Joris Leeman© , 2010
Export Planning
Learning objectives (learning tasks)
Ch. 5
At the end of the chapter you are able to:
1.
Describe a supply chain process and you understand why you can use
the supply chain as a competitive weapon;
2.
Apply the value chain model of Porter;
3.
Name and explain the different business process models;
4.
Identify key processes relevant for internationalisation within a company;
5.
Analyse the existing supply chain set up of a company.
Export Planning
Institute _II_BPM
Joris Leeman© , 2010
Export Planning
Institute _II_BPM
Joris Leeman© , 2010
Export Planning
Supply chain set up in existing markets
Example
Source: R. Hüfler a.o., students HAN University
Export Planning
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Joris Leeman© , 2010
Export Planning
Operational elements to create a competitive
advantage
Quality
Flexibility/
Responsiveness
Costs
Reliability
Ontime/
Speed
Source: Leeman, 2009
Export Planning
Institute _II_BPM
Joris Leeman© , 2010
Export Planning
Generic supply chain strategies
Low Demand
Uncertainty
High Demand
Uncertainty
Low Supply
Uncertainty
Efficiency / Lean
Reliability and cost orientation to fulfill
Make-to-Inventory
Responsive
Responsive and speed to fulfill
Make-to-Order
High Supply
Uncertainty
Risk Hedging
Reliable, flexible and on-time
to fulfill Make-to-Inventory
Agile
Responsive and flexible to customer
needs and Make-to-Order
Export Planning
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Joris Leeman© , 2010
Export Planning
Value chain model of Porter
Primary activities
Secondary activities
Value Chain of Porter
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Infrastructure
Human Resource Mgt
Technology Development
Procurement / Sourcing
Inbound
Outbound
Operations
Logistics
Logistics
Marketing
And
Sales
Institute _II_BPM
Margin
Service
Joris Leeman© , 2010
Export Planning
Value chain model of Porter
Value Chain
Main tool for identifying ways to create more customer value;
Every firm consists of a collection of activities performed to design, produce,
market, deliver and support the firm‘s products;
The value chain breaks the firm into nine value-creating activities
to understand the behaviour of costs in the specific business and
the potential sources of competitive differentiation;
The nine value-creating activities include 5 primary and 4 support activities.
Export Planning
Institute _II_BPM
Joris Leeman© , 2010
Export Planning
Value chain model of Porter
Value Chain
The firm‘s success depends not only on how well each department performs
its work, but also on how well the activities of various departments are coordinated.
Focus on Core Business Processes
- Product development process
- Inventory management process
- Order-to-payment process
- Customer service process
Successful companies develop superior capabilities in managing these and other
core processes. In turn, mastering core business processes gives these
companies a substantial competitive edge.
Source: Kotler
Export Planning
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Joris Leeman© , 2010
Export Planning
Example: Supply chain set up for PepsiCo
Value Chain
Support activities:
Procurement and therewith cost is directly
connected to (end) profit.
Primary activities:
Product availability and product acceptance
are critical success factors.
Supply Chain set up PepsiCo
Suppliers
PepsiCo concentrate
plant
Bottler
Bottling
plants
Distributor
Customers and Consumers
Retail
stores/warehouses
Plant Warehouses/
Distribution Center
Ingredients
Transport
Consumers
Packaging
Big shops
Export Planning
Institute _II_BPM
Joris Leeman© , 2010
Export Planning
Value chain model of Porter
Value Chain
- Identifying capabilities and competitive differentiators;
- Output value > Cost value = Margin
Drivers of Value Creation
1. Cost percentage
2. Relative cost compared to the competition
3. Factors influencing the cost
4. Sources of value differentiation
5. Value differentiation compared to the competition
Export Planning
Institute _II_BPM
Joris Leeman© , 2010
Export Planning
Institute _II_BPM
Joris Leeman© , 2010
Export Planning
Institute _II_BPM
Joris Leeman© , 2010
Export Planning
Institute _II_BPM
Joris Leeman© , 2010
Export Planning
Institute _II_BPM
Joris Leeman© , 2010
Export Planning
Institute _II_BPM
Joris Leeman© , 2010
Export Planning
Institute _II_BPM
Joris Leeman© , 2010
Export Planning
Example: Supply chain set up for Nestlé
Export Planning
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Joris Leeman© , 2010
Export Planning
Institute _II_BPM
Joris Leeman© , 2010
Export Planning
Chapter review questions
(10 min.)
1.
Which three flows are parts of supply chain management?
2.
What are the five operational elements to create a competitive environment?
3.
Name four generic supply chain strategies to manage supply and demand.
4.
Explain the value chain model of Porter. What is the use of this model?
5.
Why is the choice of the right business process model so important?
6.
Explain the meaning of a push-principle and pull-principle is. Give examples.
7.
Make a drawing of a supply chain set up for a company of your choice.
Export Planning
Institute _II_BPM
Joris Leeman© , 2010