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Five Principles of Value Chain Management
- Focus on customers and consumers
- Have an information and communication strategy
- Get the product right every time
- Ensure effective and efficient logistics and distribution
- Form, manage and sustain relationships
Changing consumer habits and consolidation are causing the agricultural and agri-products sector to change on a global scale. To remain competitive, businesses also need to change. Increasingly, evidence from around the world proves that embracing a value chain based business strategy can provide significant new levels of competitiveness. However, value chains and value chain management are one of the least understood, though potentially most important, business approaches of the 21st Century!
A value chain is a collection of businesses, ranging from primary producers through logistics providers, processors, distributors and retailers that progressively create value for the final consumer in a specific market segment. Value chain management is a strategic approach taken by members of a value chain to achieve a sustainable competitive advantage through aligning their resources, adapting and innovating ahead of their competitors. In doing so, they are presented with the opportunity to achieve a level of efficiency and effectiveness that could not be achieved by any of the individual businesses.
The Value Chain Management Centre assists managers from across the agricultural and agri-products sector in benefiting from the application of value chain management strategies to their commercial situations. The Centre works closely with industry partners to deliver one-day introductory, and two or three-day advanced workshops throughout the year.
Depending on the audience and specific purpose of the workshop, topics covered include the following:
- Value chains and the motivation behind their formation
- Value chain management – the fundamentals
- Developing a value chain – the process
- Benefits derived from value chain management
- Value chain mapping
- Strengthening value chains
- Critical success factors
Most importantly, the workshops use practical examples to illustrate how businesses along the entire value chain – from farm to fork – have benefited from adopting value chain management principles to their business situation. These and other insights provide workshop participants with the following benefits:
- A greater awareness of the Value Chain business approach, where improved management of processes leads to working more closely with their suppliers and customers for mutual benefit.
- Improvement in their competitiveness through access to information surrounding market demands and processes involved in producing the end product. This allows for collaboration with other organizations, combining resources to produce a product that meets the demands of the end market better than competitors, increasing product value or market share.
- Understanding of the ways in which others have improved their competitiveness and profitability through developing closer more proactive relationships with business partners.
- The ability to identify how to apply Value Chain Management principles to their businesses in order to better manage risk and reduce costs.
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