CASE Goronwy Galvanising as a value-creating system Consider a manufacturing organisation,…


Goronwy Galvanising as a value-creating system

Consider a manufacturing organisation, Goronwy Galvanising, which specialises in galvanising steel products such as lintels, crash barriers and palisades. As a value-creating system we might consider Goronwy Galvanising in the following way and as illustrated in Figure 1.4. The central system of activity undertaken by this organisation is galvanisation, which involves dipping steel products in large baths of molten zinc, to provide a rustproof coating. The main actors in Goronwy’s environment are its suppliers and customers. Goronwy uses large amounts of zinc as its raw material and which it receives from its owning company, Rito Metals. The company also receives ungalvanised material from its customers and refers to this as ‘black’ material. Both zinc and ‘black’ material are inputs into this system. The key value created by this organisation is galvanised product which is referred to as ‘white’ material and constitutes the key output from this system. Along with the flow of value through this system there is a corresponding flow of data. As we shall see, a delivery advice note identifies and describes incoming ‘black’ material, while a dispatch advice note identifies and describes outgoing ‘white’ material.
A key advantage of thinking of organisation in systems terms is that we can unpack organisation at various levels of abstraction. In other words, we can open up the box on Figure 1.4 and peer within. Any system of organisation is established to achieve one or more goals, which is typically to produce value of some form. For commercial organisations that value becomes concrete when they sell their products or services and make a profit. We can also think of the organisation as part of a value network, in which there are flows of value between the organisation and the actors in its environment (its customers and suppliers). So, as well as creating value itself, Goronwy adds value to the outputs of other actors in its value network. Steel producers, steel fabricators and zinc producers are all part of Goronwy’s value network.

CASE Goronwy Galvanising as a value-creating system Consider a manufacturing organisation, Goronwy...

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