THE VALUE CHAIN AND THREE STRATEGIC ROLES OF GLOBAL MARKETING

The value chain exposes three roles for marketing in a global competitive strategies. The first relates to the configuration of marketing.
THE VALUE CHAIN AND THREE STRATEGIC ROLES OF GLOBAL MARKETING
While many marketing activities must be performed in every country, advantage can be gained by concentrating some of the marketing activities in a single location.

VALUE CHAIN AND THREE STRATEGIC ROLES :-

Single location and Training might be at least partially concentrated in a single location for the world.
A second role for marketing is the coordination of marketing activities across countries to leverage a company's know how. This integration can take many forms including the transfer of relevant experience across national boundaries in areas such as global account management and the use of similar approachs or methods for marketing research, product positioning or other marketing activities.
A third critical role of marketing is its role in tapping opportunities for upstream advantage in the value chain. The development of Canon's AE-1 camera is a case in point. Research provided the information on market requirements that enabled Canon to develop a "world" product.

Modern concept of value chain :-

At its simplest, a value chain is an activity path through an organisation. It tells you what the organisation does and the order in which it does it. It should also tell you something about how it does it. A value chain can be a very helpful tool for understanding the difference between two organisations that appear to be functioning in similar ways in the same sector. This is because organisations can construct their value chains in very different ways. A different design of the value chain, by which we mean a different activity path through the organisation, might simply indicate a different way of doing things, or it might generate notable competitive advantage.Value chains can be used to identify sources of increased efficiency and also to facilitate ‘benchmarking’ of how competitors create value and how their activities compare with yours. Value chain analysis has four underlying elements:
1. identifying the cost of each activity
2. understanding what factors are driving the costs behind each activity
3. monitoring the processes of competitor organisations in relation to each activity (‘benchmarking’)
understanding the linkages in the chain and horizontal strategy opportunities.
You may find that even a very simple overview of an organisation's value chain gives a great deal of insight into its relative strengths and weaknesses. It is also the case that imaginative approaches to reconstructing (‘reconfiguring’) the value chain can release new ways of clustering resources and therefore new types of capability within organisations. Analysis of the value chain enables us to identify where an organisation's distinctive capabilities are based. They may arise from clear advantages in particular functions (e.g. R& D, manufacture), or from the integration of individual functional capabilities. These distinctive capabilities give rise to core competencies, which are what make the organisation what it is. They are the key to the continued success of the institution, and effective strategies need to recognize and build on them.

Conclusion :-

Value chain analysis, together with an understanding of an organisation's key capabilities, can provide a basis for decisions about whether to integrate all stages of the value chain within the same organisation or to enter into partnerships with other organisations better equipped to deliver some of those stages. Equally, value chain analysis may allow an organisation to make decisions about whether to extend its activities up or down the value chain. Certain activities on any value chain might add a high proportion of financial value to the finished product or service: these are known as high value-added activities.

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