The Role of the Engineer in the Value Chain
Assignment 1: Report
The role of the Engineer in the Value Chain
Introduction
In recent years, the requirements of commercial and industrial operations in the production of services and goods have been subject to vast changes. In the present era of globalization and increasing international competition, a trend away from vertically integrated organizations has become more and more evident. In fact, most companies nowadays tend to solely concentrate on their own core competencies, outsourcing different steps of the production. However, including a great many of other organizational units to the production systems, has lead to rising complexity in terms of the operations management (Plenert, 2012).
In this context, engineers with their accomplished problem solving skills come to the fore, implementing sciences and information technology to the development of production processes. This notion comes along with an increased focus on the management of value chains.
Against this background, the following report firstly gives an overview of the different elements of a value chain, applying this concept to the automobile industry. After a description of the engineer’s related management actions, the importance of his role in the value chain is analysed.
The Value Chain
As an approach for analysing competitive advantage, the value chain concept describes the operations of a firm in a particular industry as a linkage of activities that are performed to add value to a product (Porter, 1985). Based on this model, a distinction between a supply chain and a demand chain can be drawn. While the demand chain comprises the sequence of market-orientated activities that drive and sustain the end-customers’ needs for a certain product, the supply chain primarily focuses on the opposite part of the value chain: It represents a system of interrelated organizations that are involved in the production processes of a good, beginning with the procurement and processing of raw
The role of the Engineer in the Value Chain
Introduction
In recent years, the requirements of commercial and industrial operations in the production of services and goods have been subject to vast changes. In the present era of globalization and increasing international competition, a trend away from vertically integrated organizations has become more and more evident. In fact, most companies nowadays tend to solely concentrate on their own core competencies, outsourcing different steps of the production. However, including a great many of other organizational units to the production systems, has lead to rising complexity in terms of the operations management (Plenert, 2012).
In this context, engineers with their accomplished problem solving skills come to the fore, implementing sciences and information technology to the development of production processes. This notion comes along with an increased focus on the management of value chains.
Against this background, the following report firstly gives an overview of the different elements of a value chain, applying this concept to the automobile industry. After a description of the engineer’s related management actions, the importance of his role in the value chain is analysed.
The Value Chain
As an approach for analysing competitive advantage, the value chain concept describes the operations of a firm in a particular industry as a linkage of activities that are performed to add value to a product (Porter, 1985). Based on this model, a distinction between a supply chain and a demand chain can be drawn. While the demand chain comprises the sequence of market-orientated activities that drive and sustain the end-customers’ needs for a certain product, the supply chain primarily focuses on the opposite part of the value chain: It represents a system of interrelated organizations that are involved in the production processes of a good, beginning with the procurement and processing of raw
References: McCallum, J., 31.07.2012, ‘Lecture 1: Value chain engineering systems’, UTS Online Subject 49680, PowerPoint presentation, UTS, Sydney, viewed 18 August 2012, <https://online.uts.edu.au/bbcswebdav/pid-830878-dt-content-rid-4170157_1/courses/49680/Welcome%20Lecture%20S12%282%29.pdf>. McCallum, J., 31.07.2012, ‘Lecture 1: Supply chains, demand chains, and the value chain concept’, UTS Online Subject 49680, PowerPoint presentation, UTS, Sydney, viewed 18 August 2012, <https://online.uts.edu.au/bbcswebdav/pid-830878-dt-content-rid-4170160_1/courses/49680/Demand%20Chain%20VCE%281%29.pdf>. Plenert, G., n.d., ‘Value chain management’, viewed 17 August 2012, <http://www.referenceforbusiness.com/management/Tr-Z/Value-Chain-Management.html>. Porter, M. 1985, ‘Competitive Advantage‘, The Free Press, New York. Roadstrum, W. 1998, ‘Being successful as an engineer‘, Engineering Press. USA. Sabri, E. & Shaikh, S. 2010, ‘Lean and agil value chain management‘, J. Ross Pubishing, Fort Lauderdale. Stadtler, H. & Kilger, C. 2008, ‘Supply chain management and advanced planning‘, 4th edn, Springer, Berlin.