Value Chain Analysis and Case Study

2679 Words11 Pages
Part 1: Value Chain Analysis Value Chain: Overview Value chain analysis, developed by Porter (1996), is a tool whereby companies analyze their organization in order to decide how to develop it so that it improves. In order to best evaluate it, Porter recommended driving the business into a comportment of values and then evaluating these piece per piece. By offering the customer a high modicum of value that would exceed the input, Porter argued that organizations would be able to see a margin of profit. The more they accentuate customer service, the higher their margin of profit will be (Porter, 1996). To that end, Porter's value chain epitomized 5 primary activities. These are: Inbound logistic receiving and warehousing of raw material and their distributions to the various localities as requested Operations the process of transforming and transferring inputs into required products and services Outbound logistics the warehousing and distribution of finished goods Marketing and sales - the identification of customer needs and the generation of sales Service the support of customers after the products/ service is delivered to them These primary activities are supported by: The infrastructure of the firm its company culture, organizational structure, and other systems Human resource management the employees and personnel that the organization has put in place and its extent to which it motivates them by monetary and other compensation (both physical and intangible)
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