Description

Lancashire Business School

MD0003

ASSESSMENT 1 (50% of module mark)

ACADEMIC REPORT

Write a report (approx. 2500 words) on the following topic:

Many global companies these days operate within value-building networks and there are many factors influencing the duration of such business relationships.  Therefore, discuss how relationships between companies in the value chain may be developed and sustained for competitive advantage.

INSTRUCTIONS

READ THESE BEFORE YOU START

1. You are required to review the academic literature on networks operating within the value chain.
2. You must consider the defining features and qualities of a good network relationship and how these contribute to the individual company’s competitive advantage. You will also need to give some thought to the consequences for a company that does not perform within the network.
3. You may illustrate your points with examples of companies’ practices but these examples must be short and no longer than three lines long.
4. If your discussion relies on diagrams, etc., put them in the appendix and refer to them in your report.
5. You must not copy from your sources.
6. You must reference your academic sources appropriately within the text, using the correct format. Omitting to include references in the text will result in a FAIL mark.
7. You must also cross-reference every reference in your report to a source on the final list of references.
8. You must not depend solely on Internet sources (excluding journal articles) for your information, as this will result in a FAIL mark.
9. You must check your work for language or typographical errors before submission.
10. You must comply fully with the rules for written work in the MIP.

Note:

1)-6) above refer to the content of your report (see grading criteria below).

7)-9) above refer to the presentation of your report.  See the grading criteria below.

Solution

1.0 Introduction

As global markets continue to emerge and grow, the competition has shifted from individual organisations and now takes place in the value chains. The collaboration through good relationship in the value chain networks will the competitive advantage that ensures that all the partners in the value chain prevail (Wilding & Humphries, 2006). Many businesses which had previously added value through competencies within their firms now realize that they have to develop collaborative partnerships with external firms.

The concept of value chain was introduced by Michael Porter in 1985.  Every firm represents collection of activities that are designed to perform, produce, market and offer support for the product (Porter, 2008).  The value chain consists of primary and support activities. Primary activities are concerned with the physical creation, designing, marketing and transfer of the products to the customers. They include inbound and outbound logistics, operations, marketing and services (Porter, 2008).  On the other part, the support activities are inclusive of such activities which enhance the proper coordination of the primary activities such as technology, human resources and procurement (Porter, 2008). In order for these activities to be carried out smoothly, an organization requires varies participants who are interlinked through relations to form value chain networks. This report identifies the partners in the value chain as well as evaluating the existing literatures on networks within the value chain in addition to identifying the features of good network relationships. The report also highlights how good network relationships contribute to the competitive advantage of a firm. Similarly, it also evaluates some of the consequences that may result when an organisation fails to embrace good network relationships.

2.0 Partners in the value chain

As Christopher (2005) explains in his book, the success of the value chain is determined by the relationship that exists between the various partners.  Partners in the value chain are majorly categorized into two groups: upstream partners and downstream partners (Cova & Salle 2008).  The upstream partners are all those involved in the primary activities in the value chain such as raw materials and component suppliers, regulators, buyers and marketers. The downstream partners include all support partners that help in the overall value creation of the products. However, Benton and Maloni (2005) argue that there is no need to categorize the partners into upstream and downstream. Instead they are on the opinion that partners in the entire value chain are interlinked together forming the value chain network. As such, all partners should be………………..

 

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