Traditional views see strategy as positioning a company along a value chain. However, Normann and Ramirez argue the environment has changed, requiring companies to reinvent value. Successful companies reconfigure roles and relationships in their value constellation to continuously design complex business systems through systematic social innovation. Rather than just adding value, companies involve customers in co-creating value. The strategic task is no longer fixed activities on a chain but reconfiguring relationships to mobilize new forms of value.
The SRS Negotiations Process (SRNP) is a step-by-step methodology to negotiating significant and mutually beneficial business relationships. It is intended for use with the SRS Strategic Relationship Model (SRM). The SRM defines a framework for the sourcing, management and operational alignment of strategic relationships.
The main objective of this study was to establish the effect of Mergers and Acquisition (M&A) on a firm’s competitive advantage in the IT industry. A descriptive research approach was adopted with a target population comprising of all employees atHewlett Packard Company (HP) in Nairobi, Kenya.Horizontal mergers were found to be the most common types of mergers. These mergers weremainly driven by external economies of scale, market power, combined complimentary resources and customer service quality. The findings also established that the major elements of competitive advantage were volume of transactions and markets share. External economies of scale, market power and combined complimentary resources contributed positively to competitive advantage while surplus funds and idle resources did not drive competitive advantage. Based on the study,researchers recommended that decisions on M&A should be based on first understanding which facets of the business will be driven by the M&A in order to derive a competitive advantage. In addition, there is need for companies to do progress evaluation of the M&A specifically to review its impact on competitive advantage.
Global Best Practices / Benchmark & Tips: How to Evaluate & Assess Business P...Maz (Mazhar) Syed
Hi & Thanks for visiting ....
Are YOU currently having difficulties with existing Business Partners, Value-added Partners, Solution Partners, Strategic Partnerships, and Strategic Alliances?
This presentation will significantly help! :-)
Maz
Dubai / Mobile - IMO - Whatsapp: +971-56-1706553
Author & Writer
Sales Trainer, Leadership Trainer, Management Trainer, Communication Trainer
Manufacturing is a major contributor to GDP and employment provider in many countries. Both large and MSME are facing effects of global downturn which has made survival a test for many. With customer gains becoming far and few many companies worried about growth and profitability. Browne & Mohan consultants in this paper present the approach manufacturing companies should use to turn around profitability and survival.
Strategic management managing mergers and acquisitionsIJBBR
In this paper we have discussed what mergers and acquisitions are and how they are a part of any
organizations strategic planning policy. Organizations ‘merge’ generally with similar organizations or
‘acquire’ weaker organizations, and the essence as to why they do so is that the value of two is greater than
one. They basically merge with or acquire each other’s strengths and try to overcome one another’s
weaknesses thus leading to increased market shares and profitability. We have discussed the various
rationales for mergers and acquisitions like the strategic rationale, speculative rationale, management
failure rationale etc, along with their types that include vertical integration, horizontal integration and
conglomeration. We have also put light on how companies go strategically about mergers and acquisitions.
The merger and acquisition life cycle aided by real examples (case studies) will offer a vivid understanding
of these concepts to the reader.
The SRS Negotiations Process (SRNP) is a step-by-step methodology to negotiating significant and mutually beneficial business relationships. It is intended for use with the SRS Strategic Relationship Model (SRM). The SRM defines a framework for the sourcing, management and operational alignment of strategic relationships.
The main objective of this study was to establish the effect of Mergers and Acquisition (M&A) on a firm’s competitive advantage in the IT industry. A descriptive research approach was adopted with a target population comprising of all employees atHewlett Packard Company (HP) in Nairobi, Kenya.Horizontal mergers were found to be the most common types of mergers. These mergers weremainly driven by external economies of scale, market power, combined complimentary resources and customer service quality. The findings also established that the major elements of competitive advantage were volume of transactions and markets share. External economies of scale, market power and combined complimentary resources contributed positively to competitive advantage while surplus funds and idle resources did not drive competitive advantage. Based on the study,researchers recommended that decisions on M&A should be based on first understanding which facets of the business will be driven by the M&A in order to derive a competitive advantage. In addition, there is need for companies to do progress evaluation of the M&A specifically to review its impact on competitive advantage.
Global Best Practices / Benchmark & Tips: How to Evaluate & Assess Business P...Maz (Mazhar) Syed
Hi & Thanks for visiting ....
Are YOU currently having difficulties with existing Business Partners, Value-added Partners, Solution Partners, Strategic Partnerships, and Strategic Alliances?
This presentation will significantly help! :-)
Maz
Dubai / Mobile - IMO - Whatsapp: +971-56-1706553
Author & Writer
Sales Trainer, Leadership Trainer, Management Trainer, Communication Trainer
Manufacturing is a major contributor to GDP and employment provider in many countries. Both large and MSME are facing effects of global downturn which has made survival a test for many. With customer gains becoming far and few many companies worried about growth and profitability. Browne & Mohan consultants in this paper present the approach manufacturing companies should use to turn around profitability and survival.
Strategic management managing mergers and acquisitionsIJBBR
In this paper we have discussed what mergers and acquisitions are and how they are a part of any
organizations strategic planning policy. Organizations ‘merge’ generally with similar organizations or
‘acquire’ weaker organizations, and the essence as to why they do so is that the value of two is greater than
one. They basically merge with or acquire each other’s strengths and try to overcome one another’s
weaknesses thus leading to increased market shares and profitability. We have discussed the various
rationales for mergers and acquisitions like the strategic rationale, speculative rationale, management
failure rationale etc, along with their types that include vertical integration, horizontal integration and
conglomeration. We have also put light on how companies go strategically about mergers and acquisitions.
The merger and acquisition life cycle aided by real examples (case studies) will offer a vivid understanding
of these concepts to the reader.
Unlocking Value - Embrace Governance, Risk, and Compliance PracticesKelly Services
As more and more direct business effort must be expended toward relationships with customers, as companies feel comfortable with the reach of technology and their need to manage more amounts of highly specific data, and as more companies struggle to satisfy the career and lifestyle priorities of workers, they have warmed to the idea of outsourcing mission-critical functions.
For market leaders who are obsessed with building more company value, outsourcing has actually become a key business strategy.
A guide to values and benefits proposed by corporations, products or services to clients. A great application for candidates at interviews and how to use PVP to pass interviews successfully
Manufacturing Value Streams and Supply ChainsLucas Group
Manufacturers of all sizes now realize that there are profits to be made from an efficient and effective value chain. While the challenges are significant, the benefits of analyzing and improving your value stream are beyond debate.
Developing linkage among transactional value, acquisition value, relationship...Enamul Islam
Developing linkage among transactional value, acquisition value, relationship value and the cycle of failure of the informal service sector of uncertainty avoidance society
TRENDS & FORCES THAT ARE SHAPING MARKET SPACES & IMPACTING SHAREHOLDERSShanmugBhanu
TRENDS & FORCES THAT ARE SHAPING MARKET SPACES & IMPACTING SHAREHOLDERS, Signals that the future could be headed toward “work as fashion”, Signals that the future could be headed toward “war between talent”
1. From Value Chain to Value Constellation: Designing Interactive Strategy (1993) By: Richard Normann and RadaelRamírez Summarized by: Group 4A
2. 26/01/2011 Abstract of article from HBR hompage; “Strategy is the art of creating value. It provides the intellectual frameworks, conceptual models, and governing ideas that allow a company’s managers to identify opportunities for bringing value to customers and for delivering that value at a profit. In this respect, strategy is the way a company defines its business and links together the only two resources that really matter in today’s economy: knowledge and relationships or an organization’s competencies and customers. But in a fast-changing competitive environment, the fundamental logic of value creation is also changing and in a way that makes clear strategic thinking simultaneously more important and more difficult. Our traditional thinking about value is grounded in the assumptions and the models of an industrial economy. According to this view, every company occupies a position on a value chain. Upstream, suppliers provide inputs. The company then adds value to these inputs, before passing them downstream to the next actor in the chain, the customer (whether another business or the final consumer). Seen from this perspective, strategy is primarily the art of positioning a company in the right place on the value chain—the right business, the right products and market segments, the right value-adding activities….
3. 26/01/2011 ….Today, however, this understanding of value is as outmoded as the old assembly line that it resembles and so is the view of strategy that goes with it. Global competition, changing markets, and new technologies are opening up qualitatively new ways of creating value. The options available to companies, customers, and suppliers are proliferating in ways Henry Ford never dreamed of. Of course, more opportunities also mean more uncertainty and greater risk. Forecasts based on projections from the past become unreliable. Factors that have always seemed peripheral turn out to be key drivers of change in a company’s key markets. Invaders from previously unrelated sectors change the rules of the game overnight. In so volatile a competitive environment, strategy is no longer a matter of positioning a fixed set of activities along a value chain. Increasingly, successful companies do not just add value, they reinvent it. Their focus of strategic analysis is not the company or even the industry but the value-creating system itself, within which different economic actors—suppliers, business partners, allies, customers—work together to co-produce value. Their key strategic task is the reconfiguration of roles and relationships among this constellation of actors in order to mobilize the creation of value in new forms and by new players. And their underlying strategic goal is to create an ever-improving fit between competencies and customers. To put it another way, successful companies conceive of strategy as systematic social innovation: the continuous design and redesign of complex business systems. “ http://hbr.org/1993/07/designing-interactive-strategy/ar/1
4. Background Traditional thinking value is grounded in the assumptions and models of industrial economy. Normann&Ramirez every company occupies a distinct role in the value chain with its relationships and competencies. Strategy - positioning the right way on the value chain. Successful companies reinvent value instead of adding it. They conceive of strategy as systematic social innovation: continuous design of complex business systems.
5. Key concepts of Value constellation Any product or service is a result of a complicated set of activities: economic transactions and institutional arrangements among suppliers and customers, employees, managers, teams of technical specialists. Offering - a way to call all products and services to emphasize the way they are grounded in activity. Blurred boundaries of products/services (which is a change in the entire value-creating system). The strategy is the way the company defines its business and how it is connected two the assets that really matters; knowledge (i.e. a company’s capabilities) and relationships (i.e. customers) To reinvent and create value the strategic task is to reconfigure the roles and relationships to achieve higher value and/or new form of value. It is a continuous process and improvements needs to be developed to achieve more value Co-creation is key – involve customers in value creation process 26/01/2011
6. Managerial Implications Strategic implications of the new logic of value: Make the customers create value for themselves instead of making/doing something of value to the customer Offering more complex = more complex relationships to produce it. Company's strategic task is to reconfigure its relationships and business systems Value is in co-producing offerings that mobilize customers. Source of competitive advantage is the ability to conceive the entire value creating system and make it work. There must be a dialogue between competencies and customers.
7. CASE: IKEA - the new logic of value Redefined Roles Relationships organizational practices Result integrated business system invents value by matching various capabilities of participants more efficiently (low costs, low prices) Customer's role is not to consume value, but create it. 26/01/2011
8. CASE: Peace TrainReconfiguring business systems and Rethinking business alliance The reconfiguration of business systems and the rethinking of business alliances can be illustrated by Peace Train. They have changed they view of what a charity should be and open up to new opportunities and alliances in the virtual world that would not be possible before. To have close contact with small organizations all over the world and make micro-donations would not have been possible without a vision of creating a new type of business/charity system and creating world-wide alliances to make it all possible. 26/01/2011
9. Sources; Normann, R. & Ramirez, R., “From Value Chain to Value Constellation: Designing Interactive Strategy”, HBR, 1996. http://hbr.org/1993/07/designing-interactive-strategy/ar/1 Lecture with SteveMahaley 25th of January 2010 Founder of Peace Train 26/01/2011