Value Chain Analysis : A Competitive Strength Of The Organization

The value chain, made by Michael Porter, is really important to see how a company structure is created. The value chain is constituted by two parts: support activities (firm infrastructure, human resource management, technology development, procurement) and primary activities (inbound logistic, operations, outbound logistic, marketing and sales, service). (Johnson et al. 2011, p.97-99)

SNC’s five paragraph order was delivered meek tone which lacked authority and command presence; SNC appeared aloof and distant throughout the brief. SNC’s Situation paragraph included fabricated information contrary to what the evaluator briefed; these omissions caused the squad to not understand the mission. SNC briefed specific, relevant tasks but failed to brief any coordinating instructions beyond “attack begins immediately after this order.” SNC briefed Admin and Logistics as “unchanged since the last order.” SNC’s brief was punctuated with filler words. SNC departed towards the objective without the ammo cans required to complete the mission. During movement to the objective, dispersion was poor; at most times 5 candidates were

It is the wish of every business to be able to achieve and maintain a competitive advantage. A competitive advantage can be considered to be an advantage, a condition or even a position that will make a firm to be able to operate efficiently and also be able to produce products or services that are of a higher quality than the previous ones or than the other competing firms. When a firm is able to achieve increased earnings as compared to the costs it incurred, then it can be said to have achieved a competitive advantage according to Michael Porter, a

In order for the strategy to be successful it should realistically assess the company’s internal resources. An internal analysis is used to identify the strengths of the company and identifies the weakness to overcome in the strategy. The internal analysis will help with understanding the internal issues that exist at StilSim by evaluating a value chain analysis, a resource analysis, core competencies and a stakeholder analysis.

Steve Denning (2011), states that customer delight is the firm’s new bottom line and delighting the customer from outsets to outcomes. By focusing on delighting the customer the firm makes a lot more money than they would if they set out to make money. Delighting the customers make a lot of money. Customer delight = providing a continuous stream of additional value to customers and delivering it sooner. It is measurable and means a different way of running the company.

Value chain is the ability to take a product and add some value along the way to make it appealing to the customers in such a way that they be willing to buy the product at a certain price. Many companies in today’s business world analyze their value chains to identify the ways which continue to attract their customers. The value chain analysis consist of two parts, primary activities and secondary activities. The first ones support the actual physical process of buying, manufacturing, shipping and selling the product and the secondary activities are actions that support the process, such as procurement, technical support and human resource management.

Value Chain analysis evaluates each step business goes through from inception to finality. The goal is to maximize the value for the total cost. Costco's mission is to provide their members with quality goods and services at the lowest possible prices. The company’s mission, values and strategies suggest Costco uses a broad enterprise strategy which fits in the societal framework. To ensure employee motivation, Costco offers them a unique banquet of benefits. This include; paying health benefits for them, 50% higher wage, employee retention of over 90 percent, and maintaining employees even during recession periods (Costco, 2010). The Company’s strength is its primary value chains which split into two distinct functions: Demand fulfilment and Demand generation. Demand fulfilment includes input logistics, operations, and output logistics. Demand generation involves sales, marketing, and service department which breaks down into sub-tiers. Costco’s support activities include HRM, technology development, firm infrastructure and procurement. Costco’s weaknesses are difficult to pinpoint; one weakness is persistent low operating profit margins. Bigger profits can occur by not paying employee benefits and with demanding higher returns from their suppliers. The problem would be at what cost?  Costco receives cost advantages from value adding major (brand items) activities. However, it continues to experience a challenge

According to Michael Porter’s concept about value chain, “activities within the business companies add value to the product and service that the business organization or companies produces”. The idea of the value chain is based on the process view of organization, the idea of seeing a manufacturing firm as a system, made up of subsystems each with inputs transformation process and output. Inputs, transformation processes, and outputs involve the acquisition and consumption of resources – money, labour, materials, equipment, buildings, land, administration and

Value chain is the ability to take a product and add some value along the way to make it to appeal to the customers in such a way that they be willing to buy the product and pay the asking price. Many companies in today’s business world analyze their value chains to identify the ways which continue to attract their customers. The value chain analysis consist of two parts, primary activities and secondary activities. The first ones support the actual physical process of buying, manufacturing, shipping and selling the product and the secondary activities are is actions that support the process, such as procurement, technical support and human resource management.

|Offers low cost, shopping convenience and desirable tenant mix |Unenclosed malls yield higher cost during winter season e.g. snow|

Keane (2008) stated to design, manufacture, promote, offer and facilitate its product or services, all organization engages in some activities. All of these activities of an organization are shown through the use of value chain process. The manner in which organization performs its varying activities along with the firm’s value chain mirrors the organization’s background, strategy along with the way in which the organization executes its strategy. Ponte (2008) stated that the analysis of value chain of an organization is used to develop the organization’s competitive strategies along with formulation the connected and interconnectedness between all the organizational activities that formulate value. Francis, Simons, and Bourlakis (2008) stated that value chain analysis is a helpful tool as an organization looks to attain competitive advantage. Furthermore, Rieple and Singh (2010) stated that a value chain is a useful tool in conceptualizing the varying activities

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

Above figure is retrieved from Standard Chartered Bank Value Chain, same as Porter’s value chain, it start with inbound logistics, operations, outbound logistics, marketing and sales and service. All of those are known as primary value chain. Next will be the support activities that consist of procurement, technological and development, human resources and infrastructure.

Value chain is an approach to know how an item or activities create value for consumers. The most of value provides to consumers, the most of competitive advantage an organization build. In this analysis, value chain model has separated into primary and support activities. Primary activities are included in the physical creation of the item and service. On the other hand, support activities give the inputs and infrastructure that enable the primary activities to happen. This value chain model can be refer to below figure 5.

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.