Study On Optimizing The Value Chain Of Lanzhou Water Supply Corporation

With rapid development of information technology and economic globalization, transaction costs are becoming lower. The vertical business structure is gradually changing to the capability-based modularity business model. At present, under the background of China's marketing reform of the municipal water supply sector and its industrial development, it is essential for municipal water supply enterprises to become actively adapted to the environmental changes and foster and acquire core competence capabilities, so as to achieve success in the water market competition which is getting more and more intensive.The article begins with the summary of Lanzhou Water Supply Co., introducing its current conditions, history and problems faced in its operation, and by the means of analysis putting the issues under the macro-environment circumstances, the paper proposes that LWSC could grow successful provided that LWSC take the opportunities, and integrate and optimize its resources and enhance core competence capability. Therefore, LWSC's value chain is separated applying the capability-based value chain theory, and independent capabilities such as pump set operating capability are set free. Through the modularity design, LWSC's capabilities are fostered and enhanced, and forms LWSC's core competence advantage of operation and brand management. On the basis of the core capabilities, LWSC's value network is constructed, further enhancing its core competence. Finally, from the prospective of efficiency, effectiveness and sampling of real practices, the evaluation of LWSC's value chain optimizing design is made.LWSC's value chain optimizing design makes LWSC to focus on the most advantageous value creation nodes, and manage more effectively the whole value chain, thus making LWSC surround the customer center to create much value and acquire and maintain the competence advantage.