Value Creation

TermiKnowledge - Supply Chain, Procurement and Inventory Terminologies
View All

Value Creation in warehouse operations is the interaction of production with warehouse capacity, available space, and cost considerations. To value create, a manufacturer or vendor must first identify a need and then determine how it will best be served through their product or service. The ultimate goal in manufacturing is to satisfy a customer need in the most economical and efficient way possible. The ultimate responsibility of any business is to maximize profit while minimizing total cost.

To create value creation, manufacturers and vendors must be able to identify their target market, analyze market trends, and evaluate their prospective vendors. They must also be capable of gathering adequate information to make an informed decision on which vendors to work with and which ones to bypass. They must be able to monitor and evaluate long-term customer relationships to make sure that they are not losing future business by ignoring good suppliers. Lastly, they must be capable of providing a consistently high level of service to their prospects. This means having the tools, resources, training, support, and systems in place to support excellent service. In short, a manufacturer or vendor must address the challenges of value creation in manufacturing operations.

The third key element in value creation is creativity. Creativity is rooted in an understanding of customer needs, expectations, and what will enable them to fully utilize a new product or service. It is rooted in a commitment to continually learn about new technologies and an ability to change products as consumers' needs change. Finally, it is rooted in an understanding of how to build effective creative networks that foster ongoing dialogue and collaboration between various stakeholders.

CIOP Webinar Series

Learn the Global Best Practices in Supply Chain Management, Procurement, and Inventory Management.

60 Minutes of Learning + PDU Letter

Register Now

Do Do you want more information on Certified Inventory Optimization Professional?

Fill in the form to download the quote.