Module 3 Case Assignment - Coursework Example

Customer values the product if it is unique; it is available at affordable price meeting customers needs quickly. A firm increases value of its products either by increasing its features, quality and utility or by lowering its costs. A company adds value by performing operations and processes efficiently and effectively and by continuous innovation in its activities. A company performs primary activities such as production, sales and marketing, research and development, and servicing activities to satisfy customers’ needs.

Many support activities such as efficient materials management, human resource management, and the company infrastructure go along with in value creation process and attaining competitive advantage. Continuous learning and improvement is necessary to sustain competitive advantage and for that each important outcome needs to be compared and benchmarked (Connelley). While Kraft operates several product lines under several product categories, in broader sense, the value chain of Kraft Foods can be broken into inbound logistics, operations, outbound logistics, marketing and sales and finally services.

The first three functions lead to demand fulfillment and the last two functions are geared towards generating demands from customers. Each part of the value chain of Kraft can be analyzed, in broader sense, to know how it helps adding value for its customers. Though Kraft outsources its basic raw materials globally it always feels a need to revamp its procurement processes. It is to be noted that before 2010 Kraft had around 77,000 vendors; however, only 1200 vendors met 80% of the supply. In 2010, Kraft decided to move towards more strategic suppliers reducing their numbers and achieved 40 percent incremental savings (Ellinor, 2010).

However, the efforts need to be on revamping procurement chain significantly as that is still a major bottleneck for Kraft to meet its expanding demand of its products.