Value Chain Management: A Small Industry Perspective

Abstract

During the last decade or so, far reaching changes have been taking place in the field of business and economy in India. These changes include: liberalization, privatization, globalization, and culmination of GATT into WTO. As a consequence of these and other developments, the Indian entrepreneurs will have to operate in a totally new business landscape, where only the fittest can survive. Thus, it is imperative for enterprises of all sizes to appreciate the changes taking place around them. However, contrary to this urgency, small enterprises in general have been found to have failed to recognize that the world around them is changing rapidly, throwing open great challenges. To survive and prosper in the emerging borderless market, they would require to evolve a different outlook to mobilize and utilize resources to strengthen competitiveness both in national and international context. A widely held view is that competitive advantage comes from building value that customers appreciate and competitors find difficult to copy. In essence, creation of superior value is the outcome of effective management of discrete activities in Value Chain, which helps in achieving operational excellence throughout an enterprise by optimizing different tasks and roles within the overall process. Probably this is one of the reasons why more and more companies are embracing the concept of value chain management. In this paper, an attempt has been made to design a value chain for small enterprises and identify the specific sources of competitive advantage and how they can be related to the creation of superior value to delight customers.