Value stream mapping is a framework that could be used by the line-managers to identify the types of wastages in a value chain. The goal of value stream mapping is to identify, demonstrate and decrease the waste. Value stream mapping identifies the non value adding activities in a process and eliminates wastage due to non-value adding activities. It focuses on visual maps the flow of materials and information from the time products come in the back door as a raw material through all manufacturing raw materials. In this frame work, the line-manager could be able to track the process flow and value addition to the product in every activity. Whenever a non value adding activity is identified then it is called as waste. 1. Value stream mapping to identify the type of wastage Value-adding steps are drawn across the center of the map and the non-value-adding steps be represented in Continue reading
Strategic Management Concepts
Case Study: Restructuring Process of Volkswagen
As western automobile markets reached saturation, automobile giants like Chrysler and Volkswagen resorted to restructuring. Volkswagen had concentrated on its portfolio restructuring since early 90’s. Volkswagen acquired Skoda in 1991. Volkswagen helped Skoda to emerge out of bankruptcy and Skoda soon became “U.K.’s best loved car”. This in turn helped Volkswagen, whose profits were declining around the same time. It gained access to the little penetrated car market of Eastern Europe. In 2009, it acquired 49.9% stake in Porsche. During recession, Porsche plunged into debts. Volkswagen used this opportunity to gain from its rival, who had a respected brand name globally. Even though the car market has matured in western parts of the globe, Volkswagen has been using strategic acquisitions to grow further. The financial restructuring process of Volkswagen, called as ‘ForMotion’ is well-known. This restructuring process began in 2004. With the commencement of ‘ForMotion’, a number of workers lost Continue reading
The Importance of Core Competencies in Strategy Formulation
Strategy allows an organisation to deliver its vision. To develop a deliberate strategy which could potentially increase the sustainability of an organisation clearly requires the identification of core competencies but often a single strategy is not the answer. Organisations require a headline strategy to fit a brief which resonates the vision but several strategies are required over many departments such as research and development, production and marketing to deliver the main strategy. The process of strategy development is complex and methodology depends on several factors including the availability of resources and the external environment. The first step in strategy development is the identification of core competencies then followed by the the process of leveraging resources so they can be exploited for maximum benefit. Strategy development is a crucial step in attaining competitive advantage but a strategy is only as successful as its implementation. The process of leveraging core competencies therefore Continue reading
Intuition and Analysis in Strategic Decision Making
In the global marketplace, intuition and rational process both play a crucial role in effective strategic decision making. In various firms, intuitive process is used under the strategic management to develop effective decisions for attaining organizational goals and objectives. Intuition indicates to solve the problem with the help of using sensing and without using rational process. It can be discussed as a process to reach at the conclusion with the help of fewer information those are required for taking appropriate decisions. It is a built-in capacity that is used by the individuals to reach at the solution of the problem effectively. At the same time, it is negatively related with the stable competitive environment. Intuition is used as a business tool in many organizations to conduct and run the business successfully. Intuition is a psychological function supports to individuals for using her/his experiences and knowledge to isolate and integrate the Continue reading
Case Study: Google’s Quest for Competitive Advantage
In 1996 two computer science PhD students at Stanford University, Sergey Brin and Larry Page, were wondering how they could sort through the massive amount of information that was starting to appear on the Web to find specific and useful information on a topic. Although there were several different technologies, or search engines, available to search the Web for information, none of them seemed particularly useful to Brin and Page because they failed to distinguish between useful and trivial Web sites. Brin and Page decided to build a search engine that not only would examine the words on Web pages and then index them as other search engines did, but also would look at how and where these words were being used and at the number of other Web sites linked to a page. The goal was to have the search engine return a list of Web pages with the Continue reading
Role and Functions of Organization Culture in an Organization
The organizational culture is the general term for organizations of all members of the commonly accepted values, codes of conduct, team spirit, way of thinking, work style, psychological expectations and feelings of belonging sense of community. The corporate culture is the traditional atmosphere of a company culture, it means that the company values, such as aggressive, defensive or flexible – these values constitute of company employees vitality, opinions and behavior norms. Managers personally, these norms and instill in employees from generation to generation. Also the corporate culture is a mix of economic significance and cultural significance, refers to the formation of values in the corporate world, the code of conduct in the crowd and community cultural influences. It does not refer to the cultivation of knowledge, but rather refers to the attitude of the people of knowledge; than profit, but profit mental; than interpersonal relationships, but interpersonal life skills embodied Continue reading