Analyzing the Internal Environment and Value chain analysis on southwest airlines Case, i will be uploading the case and a sample of the value chain of another topic(company) just to visualize how the work will look like.
1. What internal resources and assets does Jamba Juice have that may give it a competitive advantage?
Analyzing the Internal Environment –
When one firm outperforms others by a wide margin over a long period of time, it’s important to figure out how this could be. The answer may lie in how that firm arranges its activities and creates unique bundles of resources that allow it to sustain a competitive advantage. Students should assess the relationships between the elements in Jamba Juice’s value chain. Every activity should add value. Take a look at Exhibit 3.1 to see the value chain activities. Based on the relationships between these elements, Jamba Juice can make a choice of how to proceed to craft a competitive advantage.
A sample value chain analysis is below:
Value chain activity How does Jamba Juice create value for the customer?
Inbound logistics (distribution facilities, material control systems, warehouse layouts) Emphasis on high quality ingredients. Conducted quality assurance testing at supplier locations to ensure product met USDA standards. Suppliers stored flash frozen product until needed. Store locations clustered to take advantage of efficient product deliveries from independent distribution companies. Jamba Juice had no central warehouse, reducing distribution costs.
Operations (efficient work flow design, quality control systems) Emphasis on consistent product quality and attention to following the recipe during preparation. Attention to store design helped maintain efficient work flow.
Outbound logistics (consolidation of goods, efficient scheduling, finished goods processing) Stores were bright, clean, had a theatrical atmosphere so customers could be entertained during food preparation.
Marketing and Sales (motivated sales people, innovative advertising & promotion, effective pricing, proper ID of customer segments & distribution channels) Jamba Juice promoted its healthy products by stressing healthy benefits, keeping the menu appealing, introducing new exciting products, creating an energizing and memorable store experience for customers. Used word-of-mouth advertising, in-store promotions, community involvement through participation in charity events, to increase customer awareness.
Service (ability to solicit customer feedback & respond) Given Jamba Juice’s emphasis on its culture, this could be a strength – energetic employees are encouraged to provide excellent service.
Secondary (or support):
Procurement (win-win relationships with suppliers, reduced dependence on single supplier) Purchased all projected product requirements at the height of the season for each type of produce in order to assure the highest quality and reduce product costs. Some issues with partners on the new products may have to do with supply problems (Nestle?). Perhaps Jamba Juice didn’t have enough experience with this type of partnership agreement.
Technology development (state of the art hardware & software, innovative culture & qualified personnel) Formal training of franchisees fostered a common culture, focus on healthy living.
Human resource management (effective recruitment, incentive & retention mechanisms) Franchisees were carefully screened; employees were extensively trained, given incentives & opportunities for advancement.
General Administration (effective planning systems to establish goals & strategies, access to capital, effective top management communication, relationships with diverse stakeholders) Change of strategy regarding franchisees might be confusing, but could help get access to needed capital. (See financial web links in the previous section.)