What is the Value Chain?

What is the Value Chain?

It is a fact that the new paradigm, the business electronic, fast forward driven by the enormous potential of new applications based on Web. From an initial approach, a "seller" web site, which offers its products and services towards a group of potential customers, going through a more recent approach of "buyer" that selects its suppliers through the network, we arrive at the approach of "virtual communities" or digital spaces for commercial exchanges, in which interest agents common share processes, and exchange information online, as well as products and services, with significant savings in costs.
Although the management of the supply chain is not a process necessarily linked to the Internet, thanks to this technology the company has discovered the possibility of expanding its management beyond its own limits, integrating in its business processes all those agents who, directly or indirectly, are involved in the value chain. The importance lies in the fact that the different business processes and information systems are united between customers, companies, suppliers and different organizations that are part of the value chain. This union requires total electronic communication between companies, which allows a customer to design and buy a product, as well as communicate requirements to suppliers during the production and distribution stages.
With these advances, the value chain has been impacted, since now integrated through information technology the cycle of the traditional value chain is transformed, where orders are made directly to suppliers, eliminating intermediaries, which reduces costs and increases productivity through a significant improvement in the costs of supply processes. This new strategic approach in the management de purchases and everything related to the processes of purchases and sourcing within an organization has enabled companies to connect to a community of providers that market their products and services.

Among the benefits for both buyers and sellers are:

q  Simplification of the internal chain
q  Process simplification
q  Productivity increase
q  Better quality of the information
q  Better control
q  Expanding the potential customer base
q  Efficiency increase
q  Increased customer loyalty
q  Improvement in the quality of information and market intelligence processes. Reduce paperwork
q  Minors costs per transaction
One of the main key factors in the integration of the value chain is technology, it is important to take advantage of the advantages that Information Technologies provide for the improvement of the organization's processes.  
Measuring the success of a strategy or initiative is not an easy task, especially if it is of great magnitude, but some factors that indicate whether a company has successfully integrated a value chain are the following:
q  Real-time transactions
q  Reduction of processing time and transactions
q  Reduction of costs
q  Precise operations
q  Better internal control of the information generated in the company
q  Access to planning information of the different companies that make up the value chain
q  Quick troubleshooting
q  Reduction of delays in order deliveries
q  Reduction of delays in delivery of supplies
q  Quick response to customer requests
q  Customer access to know the status of your orders
q  Production synchronized with market demand
It may interest you:  Corporate anorexia

::::: Conclusion :::::

When the company improves these parameters supported by adequate technology, the benefits of the integration of the value chain will undoubtedly be notable and it will be seen that the efforts have given good results.
This change and its benefits are not discriminatory, on the contrary they are for companies of all sizes, who know how to design the appropriate strategies to collaborate, connect and share information to improve the efficiency of the value chain of Suppliers. Currently the importance of participating in this type of initiative is evident and little by little the organizations are realizing the relevance of this, since otherwise they will be relegated from the market. Likewise, those late companies can receive help and be encouraged by their own clients to adopt these changes, although the outlook seems difficult, strategies must be designed to take advantage of this. 


I am a dreamer and in my dreams I believe that a better world is possible, that no one knows more than anyone, we all learn from everyone. I love gastronomy, numbers, teaching and sharing all the little I know, because by sharing I also learn. "Let's all go together from foundation to success"
Last entries of MBA Yosvanys R Guerra Valverde (see everything)