The Impact Of International Business On Business

“Competitive Advantage introduces the concept of the value chain, a general Framework for thinking strategically about the activities involved in any business and assessing their relative cost and role in differentiation”. Michael Porter, (1985).

A value chain analysis is a strategic analysis of an organization that uses value creating activities (Dess, McNamara, & Eisner, 2016, p. 76). The value chain analysis describes a company’s activities and relates them to an analysis of the competitive strength of the company

Effective value chain as a competitive advantage can contribute significantly to the prosperity of a firm in the competitive arena, but it can cause dire situations if not operated properly (Guy, 2011). However, there are conflicts among companies as to how stakeholders think they gain competitive advantage. Porter (1996) suggests: A company can outperform rivals only if it can establish a difference that it can preserve. It must deliver greater value to customers or create comparable value at lower cost or do both.

The value chain is one of the critical elements of a company’s strategy in today’s competitive world, because company’s profit depends on how the successful and efficient it runs its operations and how the end product appeals to the customers at a price that covers all the expenses of the company.

Value chain analysis looks at every step a business goes through, from raw materials to the eventual end-user. The goal is to deliver maximum value for the least possible total cost. It is a systematic approach to examining the development of competitive advantage. The most basic breakdown of primary functions includes inbound logistics, operations, outbound logistics, sales and marketing and service. People should use the other models and frameworks within this software to further differentiate between, and add to, these domains. Product Innovation is one area that is not normally included in the de jure model but is often included in the de facto model. Value Chain Analysis describes the activities that take place in

If both of these countries were given resources to produce both oil and cars it would be a waste for both the countries therefore by trading with each other, Japan and Saudi Arabia employ their respective resources efficiently by mutually benefiting from each other’s relationship. Japan gets oil that it needs to power its cars, and Saudi Arabia gets the cars that its citizen needs. Thus products that countries produce and with which they can trade freely with others countries and can achieve substantial gains from trade and can result in improving national living standards.

Successful companies are successful because of their ability manage the intrinsic concept which develops and evolves their value chain and competitive advantage. The purpose of this paper is to provide the reader with a compelling argument as to why an effective value chain creates competitive advantage. The author will also discuss and provide an analysis of the following: three critical concepts when thinking about how a value chain creates competitive advantage in relation to the value chain, competitive advantage, and customer delight. The

International business contains all business transactions private and governmental, sales, investments, logistics, and transportation that happen between two or more regions, nations and countries beyond their political limits. Generally, private companies undertake such transactions for profit governments undertake them for profit and for political reasons. It refers to all those business activities which involve cross border transactions of goods, services, resources between two or more nations. Transaction of economic resources includes capital, skills, and people. for international production of physical goods and services such as finance, banking, insurance, and construction.

The international business environment can be defined as the environment in different sovereign countries, with factors exogenous to the home environment of the organization, influencing decision making on resource use and capabilities.

Jim Riley published study notes about value chain analysis and he teaches that value chain analysis describes the activities that take place in a business and relates these activities to an analysis of the competitive strength of the business. This paper includes comparing and contrasting two articles. The first article is “The 7 Steps of Software Development Case Study-Chapter 1” but the second one is “Value Chain Analysis” by Jim Riley. Also, these two articles will be applied to the company Pep Boys, which I chose to do the value chain analysis to. Since I do not work yet, I chose Pep Boys because my close friend works there as a vice president of marketing.

Now, it’s time to give some examples of companies who utilized value chain analysis for their advantage. Now remember that value chain is producing a competitive advantage to your products. Some companies do this by lowering the overall costs of the product, so that consumers will be tempted to buy due to the low price. Other companies do this by adding cost or value to their products, this will pursue people that the brand uses quality supplies and a high standard labor force.

Value chain analysis is also a strategy tool used to analyze internal firm activities. Its goal is to recognize, which activities are the most valuable (i.e. are the source of cost or differentiation advantage) to the firm and which ones could be improved to provide competitive advantage. In other words, by looking into internal activities, the analysis reveals where a firm’s competitive advantages or disadvantages are. The firm that competes through differentiation advantage will try to perform its activities better than competitors would do. If it competes through cost advantage, it will try to perform internal activities at lower costs than competitors would do. When a company is capable of producing goods at lower costs than the market price or to provide superior products, it earns profits.

The value chain analysis can be basically defined as the various activities which happens in and around the organisation. They also relates them to the analysis of the competitive strength

The value chain analysis (shown in appendix) was also generated by Michael Porter. This model is referred to “identifying ways to increase the efficiency of the chain” (Investopedia, n.d.). Furthermore, the overall objective is to produce maximum value with minimum total cost and establish a competitive advantage.

Whether selling a product or producing a service, companies have to find and establish a set of competitive advantages (Gertner, 2013). These advantages should be advantageous to the customer and also be sustainable to the company (Gertner, 2013). The value chain is a tool that companies can use to analyze the steps they need to take to provide the highest level of service to its customers and create a competitive advantage (Blocher, Stout, Juras, & Cokins, 2016). The value chain analysis tool can be taken to the next level when companies utilize it to help them assess where they can reduce costs, which processes are not competitive or productive, and if there are any steps that can be outsourced (Blocher, et