NASAs Value Chain Analysis - Essay Example

In the value chain analysis, the primary activities tell you about the sequence of bringing materials into the business. NASA’s primary activities or business activities start from inbound logistics then it moves to the operation side or production side (designing and development of shuttles, satellites, space stations, rockets, etc.) then it moves to the delivery side or outbound logistics (shipping the completed products to the respective authorities usually another department of the administration) then finally enters into the feedback and product enhancement phase. Remember! NASA generally designs products for its own use and do not sell in the market so market and sales tasks are not included in it. NASA’s procurement department is playing a vital role in its success of it. They do their best to get raw and finished materials from all over the globe and deliver them to the respective departments.

NASA has already spent billions of dollars on its research and development program. NASA’s annual R&D budget is more than many countries overall budget. The process of technology development is vital for any company to grow further and gain a reputation in the market. Every company’s success depends upon its people - how dedicated and qualified they are. The hiring of people in an organization like NASA is not an easy task. The organizational span of NASA is very big and they have to hire people from a peon level to a scientist level. The infrastructure of every company is the basis of its success. Poor infrastructure represents the poor condition of a company; in other words, the company is disorganized and has a poor plan/strategy.

NASA’s infrastructure depends upon various tasks; it handles general management issues; the accounting and finance department; affairs of government & legal issues; and other issues created or caused by other support and primary activities. Outsourcing has become very common throughout the globe; especially western counties like the U.S.A., Canada, and England want to outsource their work to reduce costs. Hundreds of industrial giants, including Microsoft, Cisco, and Intel have already outsourced their work to other countries to save billions of dollars. Like any other organization, NASA also has opportunities for outsourcing its activities. There are many activities that NASA can easily outsource to other countries and can save billions of dollars.

By outsourcing the aforementioned activities NASA can gain a competitive advantage over its competitors – Remember! Generally speaking, NASA does not have any competitor in the U.S.; its competitors exist in other countries such as Russia and China. Although outsourcing has many advantages and it substantially helps in reducing the cost of labour, on the other hand, it can jeopardize the secrecy of NASA and other confidential information of the United States of America. Other countries experts can take the secret information related to designing and development of shuttles, satellites, and other technology of designing aerospace products; and can try to build the same structure for their country – the similar situation may occur as we are facing with regard to the proliferation of nuclear technology in the third world countries. And do not forget the fact that the technology can also be used for terrorist acts.

For the most part, accounting and finance work can be outsourced freely and by outsourcing it NASA can certainly get a competitive advantage. It also helps in reducing the cost of hiring accounting and finance experts in the US since these experts can be hired in any other country at a very low cost. By doing this, the saved cost can be utilized in other projects and also help in speeding up the process. Monitoring of space stations and satellites from other countries can certainly save cost but it can also put our country’s security in danger. However, software and hardware of general nature (not confidential) can be designed and developed in other countries.

In a nutshell, outsourcing has pros and cons. It primarily depends upon what NASA is going to outsource. NASA can outsource many activities that are not confidential such as accounting and finance-related tasks. However, outsourcing of technology designing and development related tasks can severally backfire.