How technology has extended Tesco’s Value Chain
The idea of the value chain was thought up of first by Michael Porter. The idea behind it is having a value chain in a business if for it to create a sustainable competitive advantage in the market it operates in. All businesses entail different activities that join it together to create the values chain. The Value chain of any organisation will always start with the production of raw materials and ends with the finished product in the customers possession. The principal of the value chain framework is to maximise value while decreasing cost.
Two parts are ultimately linked in the value chain analysis. First part of the value chain connects the value of the businesses activities with its functional parts. The contribution of both parts to the total added value of the business is assessed. To run a value chain analysis, the businesses activities are split into primary and supporting activities. Primary activities are linked to production, where on the other hand supporting activities like hrm establish the essential foundation for effectiveness and efficiency of the firm.
View from supplier
Tesco's development of the there value chain through the adaption of readily available technology, has resulted in great success, effectiveness and efficiency. From a suppliers (upstream) stand point, Tesco’s inbound logistics has evolved to the use of EdI’s and barcoding. An EDI (electronic data interchange) contains business data which generally represents price, quality, dates etc. By involving this technology in Tesco’s inbound logistics, there suppliers can efficiently know what product, how many and where they need to be dispatched to, in real time ‘Tesco believe that an open and constructive relationship with suppliers is key to a strong and sustainable supply chain and have used EDI for many years.
As part of Tesco’s electronic trading operations, suppliers are expected to meet the company’s labelling requirements (SSCC’s), while also providing the retailer with Advanced Shipment Notifications (ASN’s). Suppliers also need to be able to take receipt of an Electronic Proof of Delivery (EPOD) from Tesco”
View from customer
As Tesco strives in keeping up with the rapid expiation of technology and they're customers use of it. The organisation has successfully made it more easy for the modern day customer to shop online/in store, give quick quality feedback and interact online with Tesco’s customer service.
They online website allows customers to brows through pages to select there groceries and keeps a recored shopping list. As well as having a customer feedback Facebook and tab on there home page, customer service is very effective with out the customer leaving there home. Tesco have also invested in “scan while you shop” and multiple self check out service which supplies the customer with the tools they need for a quick hassle free end to they're shopping, where as scan while you shop let you...