Doing Business

Assigment 2. Doing Business

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1. Apply Porter’s Value Chain the Automotive industry in the Americas.

Primary Activities

1) Inbound Logistics

“There are four major cost drivers in the production and sale of an automobile” (Kallstrom, 2015)

Illustration 1, Market Realist (2015)

Percentages of the raw materials in a car:

• Steel 47%

• Iron 8%

• Plastic 8%

• Aluminum 7%

• Glass 3%

• Other materials 27%

2) Operations

In order to make a sync between the inbound logistics and the plant logistic, you need an intelligent system that can handle just-in-time, that can also supply uncertainties in the logistic sector.

3) Outbound Logistics

When the car is ended, you can find it in two types of Car Center:

• The Franchised (Audi, Seat, Ford)

• Car Lot

4) Marketing & Sales

For the Marketing and Sales, the enterprise can have a special department of it, but in some cases; they prefer to recruit special consulting for these areas.

Illustration 2 MMA (2017)

In the illustration 2 we can appreciate the process the marketing has in the car industry and how it works, this is developed by MMA’s modeling framework, a special Marketing Consulting.

5) Service

This topic can be the guaranty the agency gives you for the car in case of an accident, or the car check you go to every month or year to know your car is still operating good.

Support Activities:

1. Procurement (purchasing):

The ones that take this responsibility is the purchasing department.

“When there are problems with products or material received through procurement and the supply chain, the impact on automotive manufacturers can be catastrophic.”

They focus in the prices or quality and also, they examine the reasons behind a recall, either internal or that of a rival’s, can lead to clarity on potential issues. Based on the information steps can be taken to avoid suppliers who manufactured these parts, and improve overall product quality.

2. Human resource management:

An automotive business is only as strong as its employees. Within the automotive industry, human resources departments are tasked with identifying, recruiting and developing talent that ranges from cashiers to mechanics to managers and senior leaders.

3. Technological development:

Information technology has impacted the automotive industry in a variety of ways. IT has made advancements deep in the infrastructure of vehicles themselves, with emissions control, entertainment, safety features, and more. In addition, IT has impacted the relationship between dealers, original equipment manufacturers (OEMs), and customers.

There are many ways information technology can enhance business processes for the modern automobile dealer:

o Increase Efficiency and Speed

o Improve Communication

o Manage Inventory

o Improve Customer Experience

4. Infrastructure:

Poor infrastructure