Deconstructing the Value Chain

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Category: Business and Industry

Date Submitted: 10/02/2009 06:59 PM

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“You cannot make tomorrow’s decisions today. You can only make today’s decisions with tomorrow in mind.” You sited this quote in the first week of class and it resonated with me. After I re-read the article, and pondered the need for deconstructing the value chain, it led me back to this quote. Businesses make decisions at certain points in time with variables and forces relevant at that moment, and the best they can do is anticipate future changes, but it all links to available information. Strategy and the New Economics of Information focuses on increasing information availability and the impact it is having on the business landscape, both at a macro and micro level. In this essay, I will explain the concept of Deconstruction and Reconstruction of the Value Chain, apply the concept to my current company, discuss the implications and potential opportunities for my business, and throughout, draw a connection to the importance of revisiting past decisions in the deconstruction and reconstruction process as new information becomes available.

Deconstruction of the value chain is the process of examining the firm’s current structure and processes, including suppliers, customers, and information flow. “Executives must mentally deconstruct their own business. If they don’t someone else will.” Evans and Wurster are warning of the dangers of complacency. Deconstruction is the process of realizing what is changing externally and internally, and understanding the risks and opportunities associated with those changes. It is the process of asking, “Why are we doing this?” Would we do this again? What can we change?” Within deconstruction comes segmentation, as competitors are predatory and after even the slimmest of segments they can steel. Businesses can defend segments from predators by deconstructing, formulating, and executing defensive action. The article gives some compelling examples about how technological advances in computers caught Encyclopedia...