Value Chain Essay

Businesses create value by converting inputs (that is raw material, labor and overhead) into business outputs in such a way that they have a greater value than the original input cost. Manufacturing companies create value by acquiring raw materials and using them to produce something useful. Retailers bring together a range of products and present them in a way that is convenient to customers, sometimes supported by services such as fitting rooms or personal shopper advice. And insurance companies

VALUE CHAIN SYSTEM The value chain concept was created by Michael Porter and explained in his book “Competitive Advantage”, published in 1980. The value chain is a series of activities that create and build value- culminating in the contribution of total value to the organization. Porter used the concept of value chain as a systematic approach to examining the development of an organization’s competitive advantage in the marketplace. In using the value chain concept, the total activities undertaken

Michael Porter published the Value Chain Analysis in 1985 as a response to criticism that his Five Forces framework lacked an implementation methodology that bridged the gap between internal capabilities and opportunities in the competitive landscape. This framework focused on industry attractiveness as a determinant of the profit potential of all companies within that particular industry. However, significant differences in performance exist between companies operating within the same industry that

then an organization should adopt the various application of information technology. This will put the organization at the forefront in terms of innovation as well as give the organization a competitive advantage (Hitt & Robert, 2011, p.10). Value chain analysis is a model that was developed by Michael Porter to help an organization develop a strategy for its organization. Michael porter suggested that organization activities can be grouped into two major categories which include

The Advantages of Value Chain Analysis 1. A big advantage is that the value chain is a very flexible strategy tool for looking at your business, your competitors and the respective places in the industry’s value system. 2. The value chain can be used to diagnose and create competitive advantages on both cost and differentiation. I’ve written about this in Using the Value Chain to Create Competitive Advantage. 3. It helps you to understand the organisation issues involved with the promise of making

Value Chain Analysis-Costco Corporation                            Brief on the Organization Costco is among the leading global retailers which provide customers a wide range of merchandise, ranging from small to well-known brands. The company began operations in 1983. Over the years, Costco has been a retailer in low cost membership-only leader, in warehouse club of merchandise. Moreover, Costco does not offer frills warehouse business models as its competitors do.  Costco’s major competitors

Enterprise Technologies and the Value Chain The purpose of this paper is to understand enterprise technology and how it is used properly to be able to help manage the value chain of a company. Enterprise technology Enterprise technology, information, and infrastructure refers to the concept of information technology (IT) resources and data that are shared across an enterprise.. IT part is the main focus of Enterprise technology, but there is a much broader spectrum that is rarely thought of.In this

Value Chain as Competitive Advantage The idea of a value chain was first proposed by Michael Porter (1985) who identified that the more value an organization creates, the more profitable it is likely to be. Porter describes the value chain as the internal processes or series of activities a company performs “to design, produce, market, deliver and support its product” (Porter, 1985). John Shank and V. Govindarajan (1993) describe the value chain in broader terms than does Porter, affirming “the

Value Chain as Competitive Advantage If a firm sustain profits that exceed the industry average, said firm is said to have a competitive advantage. The goal of any given business strategy is to achieve a competitive advantage. Moreover, the goal of a successful business strategy is a sustainable competitive advantage. The question is how does a firm create that competitive advantage? According to Michael Porter, to achieve a competitive advantage, a firm must perform one or more value creating activities

Constructions and many more. The inventions and the perfect value chain made them the leader in these businesses. Samsung was founded by Mr. Lee Byung Chul in 1938 as a trading company. Maximum revenue of the Samsung is through their electronics subsidiary where they entered in mid-1970. After the death of the founder Lee in 1987, Samsung was divided into four business groups – Samsung Group, Shinsegae Group,