Analysis of Customer Benefit Packages and Value Chains: Report

This report provides a comprehensive analysis of customer benefit packages and value chains, focusing on the operational strategies of Wesfarmers and Linfox. It begins with an introduction, followed by an analysis of the organizations' operational strategies, contrasting their approaches to customer benefit packages. The report then compares and contrasts the value chain designs and structures of the two companies, highlighting their advantages and disadvantages. The study further explores the potential for improving operations management to enhance organizational success. Wesfarmers, a retail departmental store, is compared with Linfox, a logistics company. The report utilizes Porter's value chain model to analyze the companies' designs. The analysis considers aspects like procurement, inbound and outbound logistics, operations, marketing, sales, services, human resources, infrastructure, and technology. The report concludes with a summary of the key findings and insights into the operational differences between the two organizations.

Running head: CUSTOMER BENEFIT PACKAGES AND VALUE CHAIN
CUSTOMER BENEFIT PACKAGES AND VALUE CHAIN
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Table of Contents
Introduction......................................................................................................................................2
Analysis of the organizations concerning operations strategies......................................................2
Comparison and contrast of primary customer benefit packages....................................................3
Comparison and contrast of value chain designs and structures.....................................................4
Improving the operations management for organizational success.................................................6
Conclusion.......................................................................................................................................7
References........................................................................................................................................8

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Introduction
The report focuses on comparing and analysing the operational aspects that concern two
different organizations. The two selected organizations operate in either the same or related
industries. Specifically, focus is on understanding the differences that exist between the primary
customer benefit packages that are offered by the two separate organizations. The value chain
design structures have been contrasted to understand the operational advantages and
disadvantages that affect the two selected organizations. The organizations that have been
selected for the report are Wesfarmers retail, a departmental store operating across Australia and
Linfox, an Australia based Logistics Company. Wesfarmers departmental stores sell tangible
goods and products. Linfox is associated with the delivery of logistics services. Wesfarmers have
one of the most diversified businesses in Australia. It was established in 1914 as a farmer’s
cooperative (Group 2020). It operates its departmental stores with the brand names of Kmart and
Target. Wesfarmers are engaged in selling various kinds of retail products. Moreover, they have
particular expertise in providing quality farm produce to customers. Linfox is an organization
that is engaged in providing logistics support to various businesses. The company was
established in 1956. The company operates more than 5000 vehicles (Home - Linfox
Logistics 2020). Linfox has business operations in around 10 countries globally.
Analysis of the organizations concerning operations strategies
The operations strategies of the two companies need to be understood in order to know
the essential factors that determine their operational processes.
Wesfarmers engage in the sale of retail products through the two main brands that they
own in Australia. These are Kmart and Target. Both these brand are operated by the brand under
the single division called Departmental Stores. The strategic vision of Wesfarmers is named the
Wesfarmers way. The most important objective of the organization is to ensure satisfactory
returns to their shareholders. The key elements that are connected with the strategic vision are
maintaining financial discipline and implementing exceptional management. Developing and
implementing effective management capabilities are connected with the goals of commercial
excellence, empowerment, innovation, social responsibility, outstanding people development and
improving financial capacities.
The strategy of Wesfarmers is to provide the best product to the customers by optimizing
all levels of the operational processes. Wesfarmers engage in value creating strategies that can
also be defined by four important overarching strategies. The fours strategies are strengthening
the existing businesses, secure the prospects for growth through effective entrepreneurial
initiatives, renewing the operations by value added transactions and ensure long term
sustainability through long-term management (Group 2020). The strategies of the company are
guided by effective strategic frameworks. Effective long term maintenance of the management
systems is important in defining the strategies of Wesfarmers.
The main competitive priorities of the organization are focused on gaining better
operational effectiveness than the rival companies. One of the biggest competing firms of

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Wesfarmers is Woolworth’s retail chain. The competitive strategies of the company are based on
gathering knowledge of the strategic operations of the rivals. Subsequently, steps are taken to
optimize the operational factors that determine productivity to match those of the rival
organization.
Linfox is a logistics service providing organization and works on slightly different
operational lines. The primary vision of the company is to provide supply chain solutions to
clients across the Asia Pacific (Home - Linfox Logistics 2020). A major part of the vision is to
deliver services that are incomparable in value for the customers. The organization has to
maintain a large freight transport service to optimize its logistics operations. The operation
strategies of Linfox are defined by seamless transition, execution excellence and provision of the
right ongoing strategic advises to clients. Safety and quality are of utmost importance to the
company. The focus is on delivering the right services at the right time.
The major strategies are defined by realizing opportunities that can help the clients gain
better competitive advantages. These advantages include cost reduction, improved visibility,
technologies that are industry leading and creation of more simplified channels for logistics. The
idea is to strategically improve the supply chain of clients (Worthington 2017). The company
engages a large number of multimodal transportation vehicles to develop better operational
excellence. The operations are further enhanced strategically by recruiting the right number of
people. 24,000 employees currently work for the organization. 5000 vehicles are operated by the
organization. Constant improvement of the transportation capabilities are one of the important
strategic areas. The overall strategy is to create a smooth strategic network to better serve the
client requirements.
The competitive priorities for the organization are determined by gaining better
momentum than the rival logistics firm. This is made possible through the effective integration
of IT systems, complex design of supply chains, system integration, warehouse management,
freight forwarding and efficient distribution operations. Moreover, the organization gains
effective competitive advantage due to its business networks with the trucking association of
Australia, Industrial organization for road transport and the Australian Steel Institute.
Comparison and contrast of primary customer benefit packages
Customer benefit package (CBP) refers to a part of the toolkit for operations
management. It is the total value that a customer can get by using the tangible or intangible
services that are provided by various organizations. The differences in the customer benefit
packages of the two organizations can help to understand the value of their operational
effectiveness.
A primary benefit package that is offered by Wesfarmers is Grocery. Grocery items are
sold to the customers through the retail chain along with various other items. They are available
with both Kmart and Target. Wesfarmers has an effective supply chain that helps in providing
farm fresh grocery items to the customers. They include fresh vegetables and fruits as well as
various other agro-based products. The CBP in this case is enhanced by various factors. The
daily food requirements are fulfilled as the fresh produce can be used to make various everyday
dishes. Fruit juice is very good for health and meets the health requirements of the customers.

4CUSTOMER BENEFIT PACKAGES AND VALUE CHAIN
Moreover, there are other factors that enhance the value for the customers. The benefit package
also includes easy accessibility of farm fresh grocery products. The customers do not have to go
the local grocery markets and easily get all the products that they need at Wesfarmers
departmental stores. Moreover, the peripheral items such as knives and cooking utensils are also
available at the stores of Wesfarmers. The operations of the stores provide more value for all the
customers. The Customer benefit package that is offered by Wesfarmers to their customers are
great in developing more customer values. The operational factors are focused on improving the
time that the product takes to reach the customers. Moreover, the warehousing and logistics
functions are enhanced to provide the items to the customers that have the most demand. The
benefits package is mostly based on convenience.
Linfox provide their clients with other forms of Customer benefit packages. A primary
CBP delivered by the organization is transport. Linfox provides effective transport facilities to
their clients. A major difference is that the company caters to their clients who are mostly other
businesses. This is different from Wesfarmers as they normally cater to the CBP needs of the end
customers. The customer benefit package that is provided by Linfox is focused towards
empowering the business of their clients. They include various large and small retail, wholesale
or export-import based enterprises. Linfox provides transport feasibility to the customers among
the other important services. This improves the customer values for the client organizations. The
peripheral services that the clients get are reduced time (Worthington 2017). The transport costs
are also greatly reduced for the clients. Serving the businesses make sure that the businesses can
in turn deliver the right services to their customers. Unlike the end users that are served by
Wesfarmers, the big businesses are supported by the logistics functions of the organization. The
service provision aspects are different in terms of the values that they create for the clients. The
convenience value for customers that are provided by Wesfarmers are different to the cost
effectiveness value that Linfox provides to business organizations. The customer benefit package
of Linfox can hence be classified under time-benefits, cost benefits and business feasibility
improvement.
Comparison and contrast of value chain designs and structures
The value chain designs of the two organizations are different as they address different
operational aspects. The value chain model of porter can be used to understand the value chain
for both the organizations (Simatupang, Piboonrungroj and Williams 2017). For both
Wesfarmers and Linfox the value chain of the organization comprises of the operations, the
outbound logistics, outbound logistics, marketing and sales and services. Moreover, some of the
other important aspects are procurement, human resources management, infrastructure and
technological development.
In Wesfarmers the value chain design that is used gives more prominence to inbound
logistics, marketing and sales, operations, services, procurement, human resources and
infrastructure.
Procurement- The procurement functions take place from the local farmers of the region. The
other retail items are procured from various retailers.

5CUSTOMER BENEFIT PACKAGES AND VALUE CHAIN
Inbound logistics- Inbound logistics are very important for Wesfarmers. They include the storing
of different goods in the warehouses that are present in the organization. The various items are
stored in these places.
Operations- The operations consist of carefully sorting the various goods that are to be provided
to the customers. The customers can easily access the various items that are available.
Marketing and sales- The various items that are present in the stores are promoted through
various marketing channels.
Human resources- Human resources are managed from the store workers to the people that are
engaged with the supply chain functions.
Infrastructure- The stores are large in order to accommodate the large number of products that
are sold to the customers.
In comparison, using the porter’s value chain model, the most important aspects of the
value chain for Linfox are inbound logistics, operations, outbound logistics, services,
infrastructure and technology.
Inbound logistics- Linfox is an organization that is dependent greatly on the inbound logistics. It
receives the delivery items from the warehouses of certain organization.
Operations- The operations are important and include loading and transporting the items on
various vehicles. For the clients this is important as separate items need to be transported
separately.
Outbound logistics- Out bound logistics are done as the vehicles travel long roads to reach the
clients. Many times, the clients make their own goods travel from one part to the other part of the
country. The functions are undertaken by the freight vehicles (Group 2020).
Services- The services include providing the right kind of assistance to the clients in terms of the
best logistics functions that need to be undertaken.
Infrastructure- The infrastructures include the warehousing and sorting of the various goods that
are to be transported to various locations.
Technology- Technology is important for the organization. The communication technology
aspects are monitored and the transport vehicles are optimized in accordance of the requirements.
It is important to understand the advantages and disadvantages of the value chain systems
that are implemented across the two organizations. The advantage that the value chain of
Wesfarmers are provides to the organization is that it increases its capacity to cater to the needs
of the customers. It helps the organization provide more of the things that are demanded by the
customers over longer periods of time.
A significant disadvantage of this value chain system is that it is based much on the
procurement and inbound logistics functions. These functions can vary according to the different
places where the stores are located. Developing a uniform value chain becomes very difficult in
this process.

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Linfox uses a value chain that effectively improves its logistics functions. The entire
operational effectiveness of the organization depends on the efficiency of logistics. The value
chain is created in order to improve the logistics functions of the organization (Home - Linfox
Logistics 2020). The functional areas can determine the efficient performance of the systems.
One important disadvantage of the value chain system is that it is very difficult to
coordinate all the activities that are important in the development of the value chain. Moreover,
human resources are not given much importance in the process of service development (Reid and
Sanders 2019). Linfox can lose its efficiency if it recruits ineffective people.
Improving the operations management for organizational success
There are various factors that operations managers should consider in order to make an
organization a success. There are various best practices that can be implemented by the
operations managers in order to improve the functional attributes of their organizations.
Operations managers should be good at organizing all the operational functions in a
sequential flow. This means that all the operational levels should be organized in ways that can
enhance the prospects of service delivery. This can help to develop more effective value chains
for any organization.
There should be minimal backtracking of work in the operations process. Backtracking
refers to going back in the operations process. This should not be the case as backtracking causes
significant loss in time and finances. Operations need to be smooth and forward moving.
Reducing the movement of the materials are also important to enhance the operational
process. Materials should be moved as fast as possible from one location to the other. Movement
can take up time, which can in turn affect the effectiveness of the process (Hitt, Xu and Carnes
2016). It is important to remember that reduction in movement can end in better presentation of
the material.
Another major best practice is implementing a process that is predictable. In regards to
the same an effective flow needs to be created. The same steps should be utilized to improve the
flow of operations. Predictability would leave less to the operator and help to improve the
efficiency of the process.
Creating and open environment can help the employees to see and understand the entire
operations process. This can help in the development of better operational knowledge among the
employee. This can help in the development of smoother operational functions.
Flexible operational designs can help to improve the functional areas of the operations
process. It can help to determine the effectiveness of service delivery. The design should be as
such that it can be effectively designed to incorporate all important design elements that need to
be accommodated with time.

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Conclusion
The implications of the study points to the fact that Wesfarmers and Linfox have
operational aspects that are very different from each other. Wesfarmers are a retail based
organization and Linfox organization is based more on the inventory management aspects. The
operational measures that were evaluated for both the companies help to create a better
operational environment. The customer benefit packages for both the organizations are important
as it determines their operational success. However, the business of Wesfarmers is more inclined
towards providing facilities to the end users. Linfox is inclined towards improving the business
prospects for the other organizations.

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References
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