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Value Chain Analysis Overview

This document discusses the value chain concept introduced by Michael Porter in 1985. A value chain represents the chain of activities a firm performs to deliver a product or service to customers. It allows alignment with customers to generate quality, focuses on cost management, and provides efficient processes. The value chain model includes primary activities like operations, logistics, marketing, and support activities. Analyzing a value chain identifies value processes, areas for cost improvement, and ways to increase margins through distinctive capabilities or cost advantages.

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139 views14 pages

Value Chain Analysis Overview

This document discusses the value chain concept introduced by Michael Porter in 1985. A value chain represents the chain of activities a firm performs to deliver a product or service to customers. It allows alignment with customers to generate quality, focuses on cost management, and provides efficient processes. The value chain model includes primary activities like operations, logistics, marketing, and support activities. Analyzing a value chain identifies value processes, areas for cost improvement, and ways to increase margins through distinctive capabilities or cost advantages.

Uploaded by

hussainpadrawala0786
Copyright
© All Rights Reserved
We take content rights seriously. If you suspect this is your content, claim it here.
Available Formats
Download as PPTX, PDF, TXT or read online on Scribd
  • Introduction
  • Value Chain and the QCT Triangle
  • Value Chain Model
  • Value Chain Elements
  • Value Chain Analysis
  • Value Chain Benefits
  • Goal of Value Chain
  • Value Chain and the TBC Triangle
  • Conclusion
  • Acknowledgments

Value chain

By:- Hussain Padrawala


Urvisha duhlani
Jaydeep jadhav
Gaurang jadhav
Chetan rajput

INTRODUCTION

A value chain is a chain of activities that a firm operating in a


specific industry performs in order to deliver a valuable product or
service for the market. The concept comes from business

management and was first described and popularized by Michael


Porter in his 1985 best-seller, Competitive Advantage: Creating and
Sustaining Superior Performance.

VALUE CHAIN AND THE QCT TRIANGLE

VC allows alignment of processes with customers. This


generates a quality advantage.

VC focuses cost management efforts.

VC provides for efficient processes which improves the


timeliness of operations.

VALUE CHAIN MODEL


FROM MICHAEL E. PORTERS COMPETITIVE ADVANTAGE
SUPPORT
ACTIVITIES

Firm Infrastructure (General Management)


Human Resource Management
Technology Development
Procurement
Inbound
Logistics

Ops.

Outbound
Logistics

PRIMARY ACTIVITIES

Sales &
Marketing

Service and
Support

VALUE CHAIN ELEMENTS

Customer value added


Margin orientation
Primary activities
Inbound logistics
Operations
Outbound logistics
Sales and marketing
Service and support
Support Activities
Human resources (general and admin.)
Tech. development
Procurement

VALUE CHAIN ANALYSIS

Document the activities

Understand the cost and margins at each step.

Map the value chain to the industry value chain

Use Activity Based Costing

Look for core competencies

Map the cost structure

external values drive cost advantages

VALUE CHAIN BENEFITS

Identifies value processes

Identifies areas for cost improvement

Reduce Delivery Times

Optimize Inventory

Improve Customer Relationships

Enhance Revenue and Profit

GOAL OF VALUE CHAIN

Driven by customer perceptions

Increase margins

Focus on value processes

Distinctive capabilities

Cost advantages

Some examples

Intel Corporation

MacDonald's

VALUE CHAIN AND THE TBC TRIANGLE

Technical:

Increases knowledge of no profit zones

Increases knowledge of forward and/or backward integration


opportunities

Identifies value processes

Identifies win-win alliance opportunities

Behavioral:

Focus shifts to the customer

Focus shifts from conflict to partnering with customers & suppliers

Cultural

Creates externally focused mindset

Generates information sharing environment with respect for


confidentiality

Value Chain Analysis helps you identify the ways in which you
create value for your customers, and then helps you think
through how you can maximize this value: whether through

superb products, great services, or jobs well done.

By:- Hussain Padrawala Urvisha duhlani Jaydeep jadhav Gaurang jadhav Chetan rajput Val
INTRODUCTION A value chain is a chain of activities that a firm operating in a specific industry performs in order to del
VALUE CHAIN AND THE QCT TRIANGLE
VC allows alignment of processes with customers. This generates a quality advantage. VC focuses cost management efforts.
VALUE CHAIN MODEL FROM MICHAEL E. PORTER’S COMPETITIVE ADVANTAGE Firm Infrastructure (General Management) Human Resource
VALUE CHAIN ELEMENTS Customer value added Margin orientation Primary activities Inbound logistics Operations Outb
VALUE CHAIN ANALYSIS Document the activities Understand the cost and margins at each step. Use Activity Based Costing
VALUE CHAIN BENEFITS Identifies value processes Identifies areas for cost improvement Reduce Delivery Times Optimize
GOAL OF VALUE CHAIN Driven by customer perceptions Increase margins Focus on value processes Distinctive capabilities
VALUE CHAIN AND THE TBC TRIANGLE Technical: Increases knowledge of no profit zones Increases knowledge of forward and/o

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