Value chain analysis is a technique employed to perform evaluation of various organizations to establish the strategies employed in order to prevail in the business and outdo competitors. In Henry’s book, Understanding Strategic Management, he talks about this concept which was invented by Porter back in the year 1985. He says that the technique focuses on individual activities in an entity to find out what percentage of the total value is contributed by each of the activities. Those with a bigger difference between the revenue and the cost are assumed to bring greater value to the organization (Henry, 2008).
If one intends to bring up the organizations value, then he must be aware of the activities which are value adding. In the event of executing this management strategy, the organizations value chain is bound to interact with other value chains in the value chain system. They include the supplier, distributor and the buyer value chains (Henry, 2008).
The aim of this essay is to look into the various strategies put in place by Morrison’s Super Market so as to gain a competitive advantage over other key players in the supermarket retail business. According to the illustrated edition of Strategic Management by Thompson, Martin, and Thompson, the family owned store chain ranks well among renowned retail giants such as Tesco, Asda and Sainsbury (Thompson, J, Martin, F., Thompson, 2010). This analysis explains why this organization has managed to thrive to such ranks in the retail business which is flooded with so many other supermarkets selling almost similar products.
Value chain
Porter’s value chain had a breakdown of the various activities categorized into two; the primary and the supporting activities. Those classified as primary are those involving the actual production of goods and services whereas the supporting activities have no direct relation to production.
Primary activities
Inbound logistics
This is a very vital function of any organization when it comes to value creation. The Morrison’s has quite a huge number of reliable suppliers who handle supply of stock items. The items are stocked in a manner unique from that of the competitors such that the store setting is like an open market. Deliveries to the store are sometimes made by using the firms own vehicles cutting on contractor costs.
Operations
The establishment is known to manufacture and package some of its product brands. To ensure that buyers get fresh products, the fresh produce is stored safely to avoid wastage. It employs a very large number of staff members such as cashiers, drivers in the logistics department, butchers and others who are involved in the day to day operations in the stores.
Outbound logistics
Owning its own delivery vehicles has ensured that the firm does not have to hire other deliveries and distribution. This is a value adding tactic which has managed to facilitate convenient operations in the company. However, the fact that the firm has not introduced online sales may be considered as value reducing.
Marketing and sales
As indicated in the 6th edition of Strategic Management by Thompson, J, Martin, F., Thompson, 2010, Morrison’ have adopted strategies which make them almost unique from the competitors. The grocery giant is dedicated to offer low priced products as well as special offers to customers. The prices by competitors are slightly higher which is a reason to attract a large number of buyers wanting to save (Thompson, J, Martin, F., Thompson, 2010).
Services
In addition to its low pricing policy, it offers quite a number of services all intended to offer a buyer maximum convenience while shopping. As indicated in its official website, Morrisons.co.uk, quite a large number of services are offered which include dry cleaning, photo services, café service and many more. The stores have very good customer assistance staff and other facilities such as parking spaces.
Supporting activities
Organization’s Infrastructure
According to BBC News, 2004, Morrison’s managed to takeover one of its rivals, the Safeway. This move ensured that this grocery company increased its Market share by making an offer of close to £3bn to takeovers the organization’s stores. Winning the bid was very important for Morrison considering that other competitors like Tesco were also interested.
Human resource management
HR department is usually one of the very important units of any organization and covers everything from hiring to management of human resources. The company has invested in hiring qualified staff and training them to offer quality services to customers. Achieving this goal has created employment opportunities for a very large number of individuas in the UK.
Technology development
The supermarket chain has relied of the current technological advancements to ensure that it maximizes the benefits. Take for instance, the internet. On its official site, a customer can use the store finder and can also find various offers in the stores. Integrating of IT into the daily operations has very many benefits.
Conclusion
Depending on the above analysis, it is evident that Morrison’s Super Market has continued to maintain its high reputation and rank as one of the leading retail giants in the United Kingdom. Unlike its competitors, its main focus is on food products and groceries which is the trend in all of its outlets across UK. To maintain its status in this supermarkets business, the Morrison’s should rely on the activities which maximize the organization’s total value. Any activity with a competitive advantage can help keep them ahead of competition and increase its market share. Who know, with time, it may even overtake the likes of Tesco and Asda to become the leader in the retail business.
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