Value Chain in logistics

Raytheon Company has created new software that improves the logistics system of the company by providing constant tracking data of all products in the inventory, which has saved the company nearly $9M. MTrak is a web-based system that includes the Microsoft . Net technology, which is used to capture bar-code scans and combines it with information from the mainframe computer to provide tracking of all inventories anywhere within the company.

A lot of stuff got lost, company had to have multiple people sitting by the phones to take the calls asking where the parts were. The creation of MTrak brings Raytheon online with its competitors in the industry. While the system does not create a competitive advantage to Raytheon, it does negate the disadvantage of a bad supply control system. The creation of MTrak contributes to the entire value chain by tracking the products from the beginning of the chain at Inbound Logistics, through Operations, Outbound Logistics, Marketing and Sales, through to the end of the chain at Service.

The Technology and Competitive Forces The major problem at Raytheon was lost inventory. The suppliers were not to blame because they were able to account for every piece of property they supplied through their fully automated supply chains. From the beginning, the goal was to create a system that would track all materials used by Raytheon such as resistors, capacitors and customized computer chips from the time of order through receiving, testing, placement in inventory and final use in a military field radio, handheld motion sensor or some other Raytheon product .

Whenever Raytheon received calls for a missing delivery personnel would physically search the area to see if the product was still there. In some cases, if the item couldn’t be found the employees would reorder the item so production schedules could be met.. The MTrak is a web-based system that includes such technologies as Microsoft . Net and Biz Talk 2004. These technologies, which captures bar-code scans and other information on incoming deliveries, combine it with other information from the mainframe system such as purchase-order inventory, anufacture-scheduling data. The integration of the MTrak and mainframe computers is possible through the use of software provided by WRQ Verastream. This system lets employees track the status and movement of parts throughout the entire company from a web browser. Competitive Forces-Value Chain The Value Chain consists of five Primary Value Chain Activities and four generic categories of support activities. The primary value chain activities are supported by the generic categories.

In this case the primary chain activities that are being supported are the Inbound Logistics, Operations, Outbound Logistics, and Marketing and Sales. The supporting category is Technology Development. Raytheon created this technology in-house with publicly available software. Even though integrating the software into the daily business of the company did not create a competitive advantage, Raytheon was able to save money in many areas including lost inventory, delayed production, and outsourcing software development.

Supporting the Company The MTrak tracking system provides a state-of-the-art software package that provides Raytheon with the means to track its entire inventory throughout the entire company from a web browser. This technology improves the value chain of the entire company. Though the use of this technology, Raytheon will be on a level playing field with other companies in the industry. It may even spur Raytheon an advantage in the future as the company continues to grow.