Linked to the concept of Value chain Analysis
In my last news analysis, I discussed about the news from HT Mint which talked about the ‘Just-in-time’ (JIT) model and how it is losing its relevance in the present day world which is being hit by frequent crisis situations. Analysis was done in the light of Porter’s value chain model.
Continuing further on this, today I will touch upon another news relating to a different industry of TV broadcast, which I came across in The Economic Times. This news piece also indicates the challenges faced during covid due to working on JIT model.
The article is: TV broadcasters in firefighting mode—again
Please read the excerpts given below or the article linked above for comprehensive understanding.
This news clipping shows the supply pipeline in Broadcast industry, with channel owners, show producers, advertisers being the main entities in this supply chain. Ads are the main source of revenue, which producers are able to garner based on the freshness & quality of content, which denotes value offering for the audience. Frequent crisis and resultant curbs on shoots, lead to interruptions in the continuous flow of new show telecasts, long term repeat telecasts. All this builds the scenario of heavy losses in revenue as advertisers either withdraw their ads or ask for heavy discounts. Like in automobile industry discussed in last article, in broadcast industry too, availability of enough inventory of newly generated content is essential.
JIT model cannot work anymore here too. Applying the value chain model, broadcasters study the different activities, do a detailed cost-benefit analysis of carrying, dropping or combining of activities which can bring optimum results in content delivery. As mentioned in the news, ‘some broadcasters are assessing various options, including taking shooting crews outside Maharashtra’. In the value chain model, this would mean cost incurred on the activities of Production & outbound logistics, also other connected ones. Important is for the marketers to see if this cost get translated to value enhancement for the customers and thus generating revenues in the long run for the firm (broadcaster in this case). If this happens, then incurring this cost can prove to be beneficial.
The news also mentions that ‘Star & Disney India has a full setup in the south, whereas Zee has a studio facility in Jaipur’. Going by the value chain model, this shows that these broadcasters have already made investments in the activity of Firm Infrastructure, which in critical situations, will help in the seamless flow of new shows, giving fresh entertainment to audience & generating revenue for the broadcaster.
Hope the popularly used value chain model, analyzed by me through the news pieces relating to 2 different industries, has provided you good insights and more so with respect to challenges being posed to long standing JIT model.
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