This article uses the term “supply chain” but I think the concepts are just as valid in terms of the “value chain” principles that we discussed in class.  Working outside the legal framework of our own organization is one of the main ideas behind the importance of value chains and Cricket Communications, the company profiled in this article, is a perfect example of the benefits that can be gained by doing so.  One of the things I found most interesting was that this piece pointed out the importance of aligning compensation of employees with the strategy to make sure that there is goal congruence.

One of the biggest innovations reached all the way to the end customer. Analysis revealed huge hidden costs in Cricket’s “reverse logistics” process, through which phones are returned for replacement and repair. The main problem was a mismatch in incentives. Salespeople were rewarded for satisfactory customer transactions. If an out-of-warranty phone broke down, the sales rep found it hard to tell the customer that he or she was simply out of luck. So the rep accepted the phone for repair and the customer received a new phone free of charge, with Cricket bearing the entire cost. Absent the innovation imperative, a rules-based solution might have been devised that brought costs under control but left customers even more dissatisfied. Instead, the team came up with a more creative solution, and acted quickly to implement it.

There are many good examples in the rest of the article.  I encourage you to check it out at the link posted below.

Debugging the Supply Chain. By Keith Buckley and George Appling.  strategy+business.  July 14, 2009.