Information System Analysis: Value Chain Analysis of Latureae Report

This report provides an information system analysis of Latureae, a health and wellness company based in Australia, focusing on its value chain. It identifies and examines the primary activities (inbound logistics, operations, outbound logistics, marketing and sales, and service) and secondary or supp...Read More

Running head: INFORMATION SYSTEM ANALYSIS
Information system and critical analysis
Name of Student:
Name of College:
Authors note:
1

INFORMATION SYSTEM ANALYSIS
Contents
Introduction......................................................................................................................................3
Discussion........................................................................................................................................3
Conclusion.......................................................................................................................................7
References........................................................................................................................................9
2

INFORMATION SYSTEM ANALYSIS
Introduction
There are various activities within an organization which either helps in creating values for the
organization or helps in earning competitive advantage for an organization. Therefore it is very
essential to identify the various factors which help an organization to create value for its product
or service or to earn competitive advantage for the organization. As organizations operate in
diverse sector therefore the activities of organizations differ from sector to sector. There are two
types of activities which are mainly observed in organizations namely primary activities and
secondary activities or supporting activities. The primary activities help in adding values to the
production process of an organization whereas the secondary values help in earning competitive
advantage. The primary activity varies from one organization to other whereas the support
activities remain same for all organizations. This report focuses on the identification of the
primary and secondary activities evident in the business model of Latureae, a health and wellness
company, which is based in Australia and also focuses on providing recommendations to the top
management regarding enhancement of their customer values.
Discussion
Value chain analysis is a process through which an organization identifies their primary and
secondary or support activities which helps in adding values to the final products of the
company. As stated by Rawlins, De Lange & Fraser (2018) the analysis of the primary and
secondary activities helps an organization to reduce costs and to increase differentiation. In other
words the value chain analysis is a strategic tool which helps in analysing internal activitiesof a
firm. The ultimate goal of the value chain analysis is to recognize which activities are more
valuable to an organization and which activities could be improved in order to assist in providing
better competitive advantage to an organization.
Identification of primary activities and Secondary Activities
The primary activities which help in adding values directly into the production process of
Latureae are inbound logistics, operations, outbound logistics, Marketing and sales and services.
3

INFORMATION SYSTEM ANALYSIS
The various sub activities which are linked with the primary activities of Latureae is as follows:
Inbound logistics- The sub activities which are associated with the primary activity of inbound
logistics at Latureae are receiving raw materials from suppliers, quality control, control of raw
materials, supply scheduling and strategic relationship with suppliers and effective supply chain
management. The sub-activity which creates value for Latureae in this primary activity are
quality control and effective supply chain management.The effective quality control measures
which are in place helps in manufacturing high quality products which facilitates the high
demands of the products among the customers.
The link between the value-creating activities and sub activity is that the effective quality control
measures which are in place helps in manufacturing high quality products which facilitates the
high demands of the products among the customers. Another link between the value-creating
activities and sub activity is that the effective management of the supply chain of Latureae
ensures effectiveness in the sourcing, warehousing and distribution of products in the market.
Operations- The sub activities which are associated with the primary activity of operations at
Latureae are conceptualization, operational processes, packaging, production control and quality
control, maintenance of production process and conversion of raw materials to finished
products.The sub-activity which creates value for Latureae in this primary activity are
operational processes and production control.
The link between the value-creating activities and sub activity is that the high quality and
innovative operational process and procedures of Latureae help in increasing the sale of the
products of the company. Another link between the value-creating activities and sub activity is
that the production control process which is followed in Latureae ensures effectiveness of order
handling, dispatch and timely delivery of the products. While other link between the value-
creating activities and sub activity is that the production control process which is followed in
Latureae ensures effectiveness of order handling, dispatch and timely delivery of the products.
Outbound Logistics- The sub activities which are associated with the primary activity of
outbound logistics in Latureae are finishing goods, order handling, dispatch, delivery, invoicing,
4

INFORMATION SYSTEM ANALYSIS
warehousing, effective integration of IT tools, absence of any kind of intermediaries.The sub-
activity which creates value for Latureae in this primary activity are effective integration of IT
tools and absence of any kind of intermediaries.
The link between the value-creating activities and sub activity is that the effective integration of
the IT tools in the operations of Latureae helps in supply chain management which helps in
increasing the effectiveness of the supply chain and also helps in building better relationship with
the suppliers. Another link between the value-creating activities and sub activity is that the
absence of any kind of intermediaries in the distribution process of the products helps in ensuring
that the prices of the products remains constant which helps in increasing their sales.
Marketing and Sales- As stated by Rosales et al. (2017) the sub activities which are associated
with the primary activities of marketing and sales in Latureae are channels to market, the pricing
of the products, the advertisements of the products, the promotion of the products, the
distribution of the products, customer value of the products, cost to consumer, communication
process, convenience, customer management, market research and analysis of the sales.
Service- The sub activities which are associated with the primary activities of service in Latureae
are greater emphasis on services, training and development of employees and emphasis on
customer satisfaction.
The various support activities or the secondary activities of Latureae is as follows
As opined by El-Sayed, Dickson & El-Naggar (2015) the support activities or the secondary
activities which helps in providing competitive advantage to Latureae are Firm infrastructure,
human resource management, procurement and technology development. There are various sub-
activities which are associated with the secondary activities or support activities of Latureae
which are as follows:
Firm Infrastructure- The various sub activities which are associated with the secondary activity
of firm infrastructure in Latureae are various set of support activities of the company in the form
of general management, marketing, accounting, IT, planning and finance.
Human Resource Management- The various sub activities which are associated with the
secondary activity of human resource management in Latureae are employee retention, employee
5

INFORMATION SYSTEM ANALYSIS
motivation, training and development of employees, effective hiring and recruitment process of
the company and employee remuneration.
Procurement- The various sub-activities which are associated with the secondary activity of
procurement in Latureae are purchase of assets and raw materials and supplier management.
Technology Development- As stated by Liao, Hu & Ding (2017) the various sub activities which
are associated with the secondary activity of technology development in Latureae are process
design, product design, research and development, use of advanced technology, market testing,
product testing, use of equipment and latest technology in production and distribution and
customer research.
The above mentioned secondary or supporting activities which are associated with business
model of Latureae helps the company to earn competitive advantage in the market as the
supporting activities or secondary activities such as firm infrastructure, human resources
management, procurement and technological development helps in increasing the operational
efficiency and also helps in reducing costs for the company which helps in earning competitive
advantage for the company.
1.Firm Infrastructure Margins
2.Human Resource Management
3.Technology
4.Procurement
a. Inbound
Logistics
b.
Operations
c.
Outbound
Logistics
d.
Marketing
and Sales
e. Service
Fig: Porter’s value chain model
Source: Author
6

INFORMATION SYSTEM ANALYSIS
The above figure presents various activities and sub-activities of the Latureae business model
using Porter’s value chain model. The primary activities of the Latureae business model are
inbound logistics, operations, outbound logistics, marketing and sales, and the support activities
of the Latureae business model are firm infrastructure, human resource management, technology
and procurement.
Recommendations
The recommendation which can be made to the Latureae management regarding enhancing or
maximizing the value offered to the customers is by learning more about current and future
customer behaviour by using customer behaviour modelling technique which helps in identifying
behaviour among groups of customers to predict how similar customers tends to behave in the
similar situation and not just be relying on historical data. According to Martelo, Barroso &
Cepeda (2013) another recommendation which can be made to the Latureae management
regarding enhancing or maximizing the value offered to the customers is by effective customer
segmentation which will help the company to segment customers in to small groups and
accordingly address individual customers based on their actual behaviour. The other
recommendation which can be made to the Latureae management regarding enhancing or
maximizing the value offered to the customers is by lowering the cost to serve to the customers
by implementing different strategies such as to stop marketing to low value customers or by
moving customers to lower cost channels.
Conclusion
From the above report it is clear and evident that the business model of Latureae consists of
various primary and secondary activities with various sub-activities associated with it. The
identification of the various primary activities and secondary activities along with its various
sub-activities is very vital from the organizational point of view as it helps in identifying the
factors which creates value for the product and services of a company in the market. The
identification of various primary and secondary activities along with various sub-activities is also
very essential as it helps in identifying the source of competitive advantage for a company. The
identification and analysis of the various primary and secondary activities along with its sub-
activities is important for a company as it helps in modifying the activities of the company which
7

INFORMATION SYSTEM ANALYSIS
helps in earning competitive advantage for the company or helps in creating values for the
company.
8

INFORMATION SYSTEM ANALYSIS
References
El-Sayed, A., Dickson, M., & El-Naggar, G. (2015). Value chain analysis of the aquaculture feed
sector in Egypt. Aquaculture, 437(C), 92–101. Retrieved from:
doi:10.1016/j.aquaculture.2014.11.033 Accessed as on 4/10/2018
Liao, S., Hu, D., & Ding, L. (2017). Assessing the influence of supply chain collaboration value
innovation, supply chain capability and competitive advantage in Taiwan’s networking
communication industry. International Journal of Production Economics, 191, 143–153.
Retrieved from: doi:10.1016/j.ijpe.2017.06.001Accessed as on 4/10/2018
Martelo, S., Barroso, C., & Cepeda, G. (2013).The use of organizational capabilities to increase
customer value. Journal of Business Research, 66(10), 2042–2050. Retrieved from: doi:
10.1016/j.jbusres.2013.02.030Accessed as on 4/10/2018
Rawlins, J., De Lange, W., & Fraser, G. (2018). An Ecosystem Service Value Chain Analysis
Framework: A Conceptual Paper. Ecological Economics, 147, 84–95. Retrieved from:
doi:10.1016/j.ecolecon.2017.12.023Accessed as on 4/10/2018
Rosales, R., Pomeroy, R., Calabio, I., Batong, M., Cedo, K., Escara, N., Facunla, V., et al.
(2017).Value chain analysis and small-scale fisheries management. Marine Policy, 83, 11–
21. Retrieved from: doi:10.1016/j.marpol.2017.05.023Accessed as on 4/10/2018
9