Value Chain Analysis
please take not that this is a continuation part 2 of an assignment #1 that was done couple days ago (
item order# 111501). I willbe needing the same person to complet part 2 ( see below) that completed part
Sustainable Solutions Paper (SSP) Proposal
There is little question that the global business landscape in the 21st century is different from the
landscape of the 20th century. Companies that have been in existence for nearly the entire 20th century
are now out of business. Camera maker Eastman Kodak was one of many such companies who did not
develop a sustainable business model that would allow it to adapt to a changing environment.
Modern consumers are increasingly demanding that organizations not only meet the needs of those they
serve today but also the needs of future generations. In order to survive, organizations must develop a
sustainable model that incorporates social responsibility. Studies, such as those by Kanzah (2013), show
that companies who adopt sustainability practices that address environmental issues, societal issues, and
workforce development positively impact short-term efficiency and operations management. These
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organizations also reduce risk. Such results indicate that developing an organizational sustainability
strategy is not a moral obligation but also a business imperative.
To prepare, begin by thinking about the organization you have chosen that could benefit from applying
both the concepts of sustainability and strategic thinking for which you would like to create a sustainable
solution. Review the Senge course text. Identify an issue that interests you that may provide an
�opportunity hook� into exploring the underlying systemic relationships and business models that
Senge argues may be unsustainable.
By Day 3 of Week 2, submit approximately a 4-paragraph SSP proposal. In your proposal, identify the
organization you have selected and provide background on its history and present position within its
industry. Be sure to identify two of the organization�s main competitors. Then specify its relevance for
study, place the organization in the context of the course, providing supporting evidence/reference(s).
Use proper APA citation(s), grammar.
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Value Chain Analysis
Brookside Dairy Company is an organization that is concerned with the processing of
raw milk into various end products that include pasteurized milk, yoghurt, fermented milk, butter
and cheese among others. This company operates in the Kenyan dairy industry and happens to be
one of the well-established milk companies in that country. The Kenyan dairy industry comprises
small and large organizations. Some of these companies include KCC (Kenya Corporative
Cremearis), Tuzo and Fresha among others (Kavoi et al., 2013). Most of Brookside’s suppliers
come from the rural areas from which they delivere milk to collection stations. This milk is then
collected by the company’s trucks and taken to the firm for processing. Milk processing involves
several stages that well-coordinated to yield the final product. These stages form the value chain.
Value chain is a series of activities or processes that an organization operating in a given
industry executes to deliver or provide valuable services and products. This concept is founded
on the process view of firms and takes into consideration the aspect of viewing a service or
manufacturing organization as a system, which made of subsystems with transformation
processes, inputs and outputs, and involve the consumption and acquisition of resources such as
materials, labor, money, management, building, and administration (Agrawal et al., 2014). Value
chain has significant effect on the business strategy as it affects the operations and logistics
involved in the success of a business. As such, the business strategy of the firm should be
developed in a manner that matches its value chain.
Technology impacts significantly on the value chain of a company. High technological
research and development process activities contribute positively to the value chain of a
company. Some of the aspects of technology such as automation of processes and other
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monitoring activities offer a great support to the value chain, which lead to enhanced efficiency
and effectiveness of a company’s operations (Schloetzer, 2012). On the other hand, low
technology affects the efficiency of firm’s value chain in a negative way.
Analysis of the company’s value chain takes into consideration the various processes that
are involved in milk processing. This goal can be accomplished by focusing on the activities
involved in conversion of milk into finished products (Agrawal et al, 2014). In relation to this,
the company’s weakness exists in the inbound logistics involving warehousing of the raw milk
that has been received from the suppliers. This problem results from inadequate cooling centers
to cater for excess milk from suppliers. Moreover, the company’s cooling centers are located far
from the factory due to lack of space near the organization. Thus, what are the ways through
which the company can address the problem of handling extra milk from suppliers and far
location of cooling centers? However, the company has strength in terms of outbound logistics
and operations. The company has a well-coordinated system of converting milk into a high
quality end product or products. In addition, the company’s outbound logistics takes into
consideration a proper distribution channel that entails wholesalers and retailers.
Milk processing involves a series of interconnected stages. Once milk is received at the
factory, it is analyzed for freshness using various tests and then transferred to cooling tanks.
From the cooling tanks, the milk is taken for pasteurization and then analyzed for quality prior to
packaging (Kakoi et al, 2013). The milk from the cooling tanks can also be processed into
various products that are analyzed prior to their packaging. These processes are conducted
through a well-coordinated task force that operates in various departments within Brookside.
The company’s value chain has a strategic significance to the larger value chain as it
ensures a constant supply of milk and milk product into the market. Taking into consideration the
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fact that the firm has an advantage in terms of outbound logistics, the organization has various
warehouses and centers where processed milk and milk products are taken prior to their
distribution (Kavoi et al, 2013). From these centers, the products are taken to wholesalers who
sell them to retailers, who in turn sell them to the final consumers. Moreover, the company has
retailers who purchase products directly from the firm then sell them to final consumers.
According to Agrawal et al, (2014), there are five categories of forces in the external
environment: economics, demographics / social / culture, government / legal / military, physical
environment, and technology. Input to the General Force Analysis (GFM) is the organization’s
external environment composed of these five categories. The idea is to analyze the external
environment external from the organization through trends, events, or forecasts of interest to the
Economics; the economic factors facing Brookside are the purchasing power of
customers especially in the inflation rocked economy. With most of customers unemployed, their
purchasing power is greatly reduced which negatively impact on the company. Advancement in
technology has a crucial role to play in the industry (Kavoi et al, 2013). Ne technologies are a
great opportunity for the company to improve efficiency and earn a competitive advantage. The
population in Kenya is growing at a high rate, a trend that is expected to continue in the coming
years. In this regard, Brookside should postulate larger markets in the future. Kenya being a
developing economy provides a great potential in terms of government’s policy in investment
and policies. The government is committed to make conducting business in Kenya easy as it
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aims to achieve its Vision 2030; through industrialization. Some variables of interest may
include poor road networks in areas that Brookside acquires its primary raw materials from.
Accessing milk in the rural areas is problematic especially during rainy season.
The Porter’s five forces model is a framework used for the analysis of the industry and
business strategy development (Kakoi et al, 2013). Attractiveness within this context refers to the
overall profitability of the industry.
Entrance of new players in the market is currently a relatively low threat for the
Brookside Company (Kavoi et al, 2013). This is because of the high cost of investment required
in this industry. Brookside is facing an increasingly stiffer competition from its close rivals in the
industry such as Fresha and Tuzo. It is imperative that the company develops a sustainable
strategy through innovation to counter this rivalry. It is clear that the external forces have
significant impacts on Brookside and its competitive edge. Some external factors have presented
great opportunity for the company.
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Agrawal et al. (2014). Managing Value in Supply Chains: Case Studies on the Sourcing Hub
Concept. California Management Review, 2(56) 23-54
Kavoi et al. (2013). Influence of Institutional and Socio-Economic Factors on the Supply
Response of Smallholder Farms in the Marginal Zones of Kenya. Journal of
International Development, 25(3) 393-411
Schloetzer, D. (2012). Process Integration and Information Sharing in Supply Chains.
Accounting Review, 3(87) 1005-1032.