by Kenneth Rudich
The generic value chain for marketing provides a tool for conceptualizing the value-creating activities within a marketing strategy, for mapping them, linking them, and tracking them over time.
The notion that everything ought to be tracked over time alludes to the idea that strategy and tactics – their development and implementation – are by definition fluid and emergent. They require ongoing attention and critical analysis. In short, they must be managed in order to keep the business goals and objectives attuned with the opportunities in the market.
the strategic learning cycle
The discipline behind an effectively managed value chain strategy is built around a concept known as the strategic learning cycle.
As the name suggests, it is a repetitive process for analyzing strategy across time:
- The Past – where you’ve been
- The Present – where you are
- The Future – where you should be going and how to get there
The discipline of it stems from the analytical framework that it follows. That framework includes:
- Identification and/or Adaptation of Strategy and/or Tactics: establishing or adjusting strategy or tactics to reach the next desired level of performance from both an output and outcome perspective;
- Planning and Process Mapping: developing or adjusting processes to effectively carry out the strategy and tactics;
- Application or Implementation: actual performance of the processes;
- Output/Outcome Measurement and Assessment: critically evaluating actual results against strategic goals and tactical objectives.
Each pass through the strategic learning cycle theoretically adds to the accumulation of insights and knowledge for evaluating the effectiveness of the value chain strategy and tactics – that is, what works or is working; what doesn’t work or isn’t working; and what changes should be made to either the strategy or the tactics.
The ideal scenario is to have each successive pass function like a virtuous cycle of decision-making improvement.
responsiveness, joint-use and re-use within the value chain
The purpose of the strategic learning cycle is to maintain the integrity of the value chain along three specific dimensions. They are responsiveness, joint-use, and re-use.
Responsiveness deals with the actions taken in light of the external forces and the role of creating value. The objective of this outside-in perspective is to determine what the business should do with each component of the value chain in order to deliver value fulfillment. In “The Balanced Scorecard,” authors Kaplan and Norton encourage careful thought when pondering this matter. They say, “The essence of strategy is not just choosing what to do; it also requires choosing what not to do.” The strategic learning cycle assists with being selective about the choices made, and with understanding why some were made and others were not.
Joint-use identifies opportunities to prune inefficiencies within the value chain and leverage them to better advantage. This perspective has more of an inside-out orientation. You can read more about Joint-use here.
Re-use centers on strategies for reducing waste. Analyst Mike Blecher at Gartner Inc., Stamford, Conn., divides re-use into three categories when figuring out what can be re-used: technology or technical components, business components, and application templates. To be effective across time, re-use requires a systematic approach rather than one done on an ad hoc basis. That’s why it’s also included in the strategic learning cycle. You can read more about Re-use here.