Internal Analysis

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Internal Analysis

Question One

Michael porter gives a detailed analysis of value chain through providing an analysis of the various activities performed by a given organization as well as a linkage to the organization’s competitive position. In essence, value chain analysis is the description of the activities that occur within and around a given organization thus evidencing the competitive strength of a company. This involves the valuation of each activity within the organization commensurate to the given output.

Porter holds that the competitive advantage of a given organization stems from its ability to perform particular activities and its rightful administration of the associations. The components of the model comprises of primary and supportive activities. Porter regarded primary activities as those that are directly associated with the provision, formation or delivery of an institution’s relevant products or services (John, Grant and Marjorie 13). Primary activities are grouped into five categories. These are inbound logistics, operations, outbound logistics, marketing and sales, and service.

All the above primary activities are then linked to their relevant support activities used in enhancing their effectiveness or efficiency. Support activities are then grouped into four main areas: Technology development, which includes research and development procedures, the entire procurement processes, the complete human resource management, and the organization’s infrastructure comprising of systems for planning, finance and quality information management.

Question Two

Gamble, Savage, and Icenogle have been able to raise key points in the field of telemedicine in the article Value-Chain Analysis of a Rural Health Program: Toward Understanding the Cost Benefit of Telemedication. The first issue is considerable variance in the application of the value chain analysis. In particular, those requiring real-time consultation have proved unfeasible in the long-term duration without subsidization.

The authors note that telemedicine can be efficiently practiced with the help of increased and enhanced capacity utilization. Balancing capacity utilization with reserved structural overheads and nominal execution expenses is necessary in making a project feasible. If the above is not implemented, then telemedicine processes have to be remodeled to reform the value chain in such a way that models a sustainable economic model development possible (John, Grant and Marjorie 15).

Another notable aspect is the structuring of value chains for some clinical applications in a structure that allows subsidies to cover incurred expenses. Value chains are modeled in such a way that they entail a combination of both structural and execution costs. This makes the costs impossible to recover through simple increment of professional fees or the enforcement of technical fees. Another aspect of telemedicine programs is their ability to employ self-financing and commercial clinical applications to subsidize internally those activities that are not profitable even though they are of substantial benefit to the entire project. An example of these commercial clinical applications is teleradiography.

Another notable point is the availability of telemedicine applications whose value chains involve substantial savings in terms of expenses incurred in comparison to traditional delivery models. This leads to forecasting of final abandonment of the traditional delivery models and the adoption of the selected telemedicine applications by the entire United States healthcare industry. This is particularly noted in the delivery of specialty medical services. The main reason behind this is the evident cost effectiveness noted in the practice.

Question Three

Porter’s model was used to evaluate the cost-effectiveness of implementing telemedicine in rural health practices through the assessment of the linkages between activities and functions that take place during the service delivery processes. In order to attain this need, an analysis of the value chain was conducted. This involved detailing all costs incurred within the project and linking the same to their relevant activities. The next procedure entailed the analysis of customers’ value chains. During this procedure, various products were fitted together into the value chain. Potential cost advantages were identified and a comparison made with regard to competitors. The potential value added for the customer was then identified and detailed. This comprised of an analysis towards the products and services, thereby enhancing worth to the customers’ value chain (John, Grant and Marjorie 16).

Question Four

The employment of the model in the strategic planning process had great value in telemedication. Analysis shows that after incorporating the value chain model, multiple value chain participants were compelled to deliver value and endeavor in the attainment of a common goal. All chain participants ranging from employees, managers, suppliers and customers were addressed within the implemented actions. The organization was able to stay ahead of its competitors and in tune with the dynamic requirements of the customers. This enabled the organization to maintain profitability and feasibility in the long run (John, Grant and Marjorie 17).

Works Cited

John Gamble, Grant Savage and Marjorie Icenogle. “Value-Chain Analysis of a Rural Health Program: Toward Understanding the Cost Benefit of Telemedicine Applications.: Hospital Topics 82. 1 (2004): 10-17. Web. Sept. 16, 2011.