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Dear Tutor,
Hello!
I got a question to ask, which relates to the MCS.
In a question asking for briefing notes about the proposed strategy’s (relating to cost reduction) implications on a designated company’s business model, what do you think about my approach shown below?
1. I shall answer the question by listing all elements of value chain (cost reduction may fall into the input stage of value chain) and relate them to both pre-/unseen info. Also, I will discuss which element may be affected.
2. I further discuss implications in terms of costs and IT, which can be related to the value chain and Generic strategy (cost focus). Also, I shall discuss what effects will be on them.Thanks and regards,
Jasper
I tend to stay away from value chains unless question information/requirements seem to point heavily to them. They are complex and often a bit ‘fuzzy’, especially with regard to how the elements interact. Certainly do not go through all the elements (about 10) if many have little detail to analyse.
Generic strategies are simple: cost leadership or differentiation (each either with/without focus) and usually easy to relate to proposed changes. From generic strategies it is often easy to make targeted diversions into elements of the VC.
For example, IT enhancement might enable more cost savings (better integration of orders and production, so reinforcing cost leadership) but would also potentially aid the sales and marketing activity (eg Internet ordering, keeping customers up-to-date with their order progress).
HTH.
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