BPTF - Value Chain Segmentation

 
Every global company must constantly evolve it's value chain, which encompasses a wide spectrum of relationships (suppliers and customers), product portfolios, brands and regional sales channels. With the constant changing of market conditions and competitive landscapes, global companies face a challenge of increasing complexity, while trying to standardize processes and reuse assets. Understanding it's value chain segmentation and how to best align it to the global market complexities to maximize global assets utilization is a critical step in defining any company's strategy. To faciliate fast and precise evaluation of strategic opportunities and transformation requriements, BPTF provides pre-defined value chain segmentations for a number of industries and companies.
 
Value chain segmentation defines all critical processes (fully connected) together with the performance parameters that must be controlled and optimized that any value chain must excel in any given industrial sector and for any given business strategy. To aid in precision of the strategic planning, the VCS breaks down in parallel the actual design of the value chain (a complete set of connected process flows) and the control system that established if the processes are delivering the value according to the needs and expectations of the value system within which the company operates. 
 
BPTF Value Chain Segmentation (VCS) is decomposed into seven levels to provide a precise definition of a company's processes within context of a given marketplace. The first three levels are not specific to any given company or its strategy, but to the market aspects within which the company must establish its value add. Industry sector is a broadest economic category within which multiple value systems operate.
 
For example, the automotive industry is a sector consisting of several value systems, such as passenger vehicles, commercial vehicles and military land systems. While military land systems can also be a value system within the government services industry, the first two will show up only in the automotive industry. Within the passenger vehicles value system, one can observe several value chains - such as OEM, dealer, Tier One supplier, etc.
 
Value Chain Design (VCD) is then a company specific set of end-to-end connected processes that best address the company's strategic objectives as expressed by priority dimensions. Value system management then provides a set of control mechanisms that allow any value chain to establish value targets that it needs to hit within its value system and an entire structure of measure and control mechanisms that will allow it to swiftly adjust its value chain design to changing conditions and objectives.
VCD is a company specific end-to-end configuration of all value adding processes designed and integrated in a way that best addresses strategic objectives and needs of all value chain stakeholders. (click here for more information)
VSM is a set of methods and techniques used to measure, control and evaluate performance of all value streams, process flows and activity flows within the value chain. VSM closely corresponds to the Value Chain Design, and the two have to be established and adjusted simultaneously. (click here for information)
 
Industry classification or industry taxonomy organizes companies into industrial groupings based on similar production processes, similar products, or similar behavior in financial markets.
 
 
Value  Systems apply to whole supply chains and distribution networks. The delivery of a mix of products and services to the end customer will mobilize different economic factors, each managing its own value chain.
 
Value Chain - Defined as a sequence of highly structured organizational processes and partners to create, produce and deliver a product or service satisfying customer and market demands form a company specific perspective.