This assessment will cover following questions:
- Revaluate the use of value chain model.
- With the help of value chain model examine internal environment of the organisation.
- Reflect the usefulness of value chain model in assessing the internal business environment of the organisation.
Internal business environment mainly composed of various factors and components that are basically present inside the organisation and affect the various choices, decision making and activities of the organisation (Passetti, Cinquini and Tenucci, 2018). The aim of this essay is to provide an understanding and reflection about the use of value chain model to examine the internal environment of an organisation which includes both primary and supporting activities of a business firm. The organisation selected to meet the aims and target of this easy and assignment is Aston Martin, the information and brief about which is also form a part of this easy and provided on this report.
Value chain model
The value chain model which is also known as the Porter’s Value chain analysis was developed and created by Michael Porter. He has explained value chain model as a collection of activities and tasks that are basically performed by every company and organisation to create value for its customers and clients (Value Chain Analysis, 2019). Thus, the main aim of value chain model is to maximize the value addition for customers which lead to and facilitates the competitive advantage and higher productivity and profitability for an organisation. The strength of this model of the Porter’s Value Chain is its approach the main focus of which is on the systems and other activities which are related with the desires and end product provided to customers as its central principle rather than having a focus on departments and other accounting expense categories of the organisation (Prentice, 2018). The value chain model basically links the systems and activities with each other and emphasis on demonstration of its effect and influence created on costs and total profit of the company. Thus, use of value chain model makes it clear where the wastage of sources and resources while the process of value creation can be reduced or minimized to maximize the profits of the organization for achievement of target of cost efficiency in the organisation during the process of value creation and production of product and services for customers. Porter has described a chain of activities and task that are common to all businesses and he has divided and categorised these activities into primary and support activities which are shown as below. Take assignment help to our best writers.
A number of activities are included in Porter’s Value Chain Analysis namely primary activities and support activities. Primary activities are those which have an immediate and direct effect on the production, maintenance, sales and support of the products or services that are to be supplied to customers. The inbound logistics, operations or production, outbound logistics, marketing and sales and all other related maintenance services form a part of primary activities on the basis of value chain model. Beside this, the secondary activities are those which assist or support the primary activities and for the basis for all organisations (Mak and Chang, 2019). The activities that form a part of secondary task or activities are firm infrastructure, technology development, human resource management and procurement.
Aston Martin Company
Aston martin is an exclusive, modern sports car brand which is providing a unique heritage to its customer across the world (Aston Martin, 2019). This organisation was formed in 1913 and is established by Lionel martin and Robert Bamford at London, UK. Aston martin has become an iconic global brand which is considered as a synonym of style, performance, luxury and exclusivity and a company that provides the best fusion of latest technology, graceful styling and time honoured craftsmanship to develop a range of critically acclaimed sports cars. The current range of award-winning sports and performance GT cars gives Aston Martin its strongest line up in the marque’s history. Throughout 2013, Aston Martin’s centennial year, the company added the exhilarating V12 Vantage S, elegant Rapide S and the ultimate convertible Aston Martin; Vanquish Volante. These cars have joined an established range comprising Vanquish Coupe, DB9 and V8 Vantage. Information for all models is available through the ‘models’ area of this media site (Hassanien and Dale, 2019). Boasting a top speed of 205mph, V12 Vantage S becomes the fastest production Aston Martin in the firm’s 101-year history, with the exception of the ultra-exclusive One-77. In contrast, Rapide S combines Aston Martin’s characteristic performance with the practicality of four seats, cloaked in one of the most graceful bodies.
Thus, since the first Aston Martin was crafted more than a hundred years ago, they had a talent for creating beautiful cars started from a small London workshop and now has grown to become an internationally admired luxury brand. Aston martin is having a efficient global presence and its operation are spread in six continents that include more than 50 countries of world that consist China, Turkey, Qatar, Austria, France, Denmark, Riyadh, Jordan, Germany, Greece, Monaco, Italy, Russia, Sweden, Canada, Peru, United States, South Africa, United Kingdom, and Kuwait (Grewatsch and Kleindienst, 2018). The company has opened a showroom in Abu Dhabi at Etihad Towers. This move cements its place in UAE but still its headquarters base and main manufacturing site at Warwickshire in England. A big role in success of Aston martin is played by their employees who are passionate for machines, propulsion, engine and racing. There passion and talent makes them able to build and develop the cars that are faster, more powerful, thrilling, comfortable and more beautiful than the previous one.
The internal environment of Aston Martin includes all the activities and operations conducted within the organisation with the aim of providing best services and product to its customers (Arnett, Sandvik and Sandvik, 2018). To develop a better understanding about the internal activities and role of the primary and supportive activities in creating value for customer started from acquiring raw material till using them to produce something useful and desirable for consumer use of value chain model is made. An explanation of Porter’s value chain model in context with the internal environment and various activity of Aston martin is provided below:
These are the activities that are directly associated with the physical creation, maintenance, sale and support of products and services provided and supplied to customers. Following are the primary activities carried out in Aston martin for ensuring supply of desirable products to customers:
Inbound Logistics- This activity is associated with receiving, storing and internal distribution of raw material or other basic integrants required for manufacturing of a product. The Aston martin is having a very efficient relation with its suppliers to ensure a smooth and timely availability of all required raw material, batteries, engines, etc to have a uninterrupted production of products (Yang and Weber, 2019).
Production- These are basically a set of transformation activity that converted raw material and inventory into a finished product and includes operations like machining, packaging, assembly, equipment maintenance, testing, etc. aim at creating best quality product for customers. The operational system or production department of Aston martin is located at London which is quite efficient and provides relevant guiding principle for creation of value for customers. Want essay help? Talk to our experts Now!
Outbound logistics- These are the activities and tasks associated and related with the delivering and distribution of product and services to the end customers. The main activities included in outbound logistics are mainly includes storage, distribution system and transporting network of an organisation (Cheah, Amran and Yahya, 2019). Aston Martin is having a strong, powerful and well connected and coordinated distribution network that includes various dealership programs and its own exclusive showrooms for ensuring timely supply of its product to its customer with great connivance.
Marketing and sales- These are the activities and process related with putting and introducing a product or services in the target market that includes generating and managing the effective relationship. Aston martin is having an effective marketing and sales strategy to remain apart and superior to its competitors in the market which includes best channel selection, advertising, promotion, selling, pricing and retail management (Srinivasan and Jomon, 2018)..
Services- These activities are related with maintaining the value of product after it has been purchased by customers. Aston martin also provide proper after sale services to its customers which includes customer support services, repair services, installation, training for effective use, spare parts management, up gradation, etc.
These are the activities which provide support and aid in effective function of primary activities through facilitating an assistance and framework for them. The main support activities that are forming a part of internal environment of Aston martin are as follows:
Firm infrastructure- It is basically associated with firm’s support system that allows an organisation to maintain and fulfil its day to day to operations effectively. The accounting, administrative, legal, fiancé public affairs and other general management activities of Aston martin are fall under these support activities that ensures an uninterrupted and effective flow of working (Landrum and Ohsowski, 2018).
Human resource management- These activities are associated with development of workforce which is a key element for success of any organisation. The Aston martin have a well structured HR process and activities to ensure recruitment of talented and creative employees and beside thus timely staff training and coaching is also provided to enhance their knowledge and make them able to efficiently support all other activities of organisation (Tourky, Kitchen and Shaalan, 2019).
Technology development- These activities are related with managing and processing technology and information associated with keeping a phase with latest innovation and improvements in technology. Various activities are conducted by Aston martin with the aim of minimizing cost of information technology for staying current with technological advances, and maintaining technical excellence for creation of best value and product for customers.
Procurement- These are the activities related with getting resources which are needed to operate the various functions and operations of organisation (Strang, 2018). The Aston martin is having activities and process to enter into a market and effectively managing the relationship with suppliers and includesnegotiation to arrive at the best prices and also includes making product purchase agreements with suppliers and outsourcing agreements to facilitate support for logistic activity.
Know More: LSBM103 Value Chain Model
Reflection on value chain model
The journey of writing this essay and completing this assignment is full of information and knowledge that has provided significant amount of knowledge and information about value chain model. It has been learned by me that value chain model is developed by Porter’s in with the aim of developing and identifying various activities that are conducted in all organisation with the aim of creating value for its customers. The automotive sector of UK is fast growing and rapid changes and innovation are going n in this sector thus, the organisation selected for this easy is Aston martin which is a well known and famous brand of exclusive sports cars. It had been evaluated by me that internal environment of Aston martin also includes a wide range of operations to ensure the regular supply of its product to provide the maximum value for its customers. A range of activities are there which facilitates transformation of inventory into finished products with marinating the cost efficiency in its operations. All these activities are divided into two categories by the Value chain model which includes a set or chain of primary and supportive activities.
The main aim of making use of value chain model is to recognise the activities that are most valuable to the firm and that can be improved to have competitive advantage. I have learnt that value chain analysis is a tool that helps in identifying those activities and tasks which facilitates quickly reduction in cost, optimizing effort, eliminating wasteful activities and task with the aim of increasing productivity and profitability of organisations through better value creation for customers.
On the basis of above report it can be concluded that the internal environment of an organisation comprises of various activities and operations that are necessary to create value for consumer. Use of value chain model is made to get a better understanding about these activities and their role in creating value and providing a suitable product or services to customers. These activities are classified as primary and supportive activity where primary activity are directly associated with manufacturing of product while supportive activities are there to assist and ensure smooth operations of other activities.