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Assessing the Primary Activities in the Value Chain

Assessing the Primary Activities in the Value Chain

Name: Assessing the Primary Activities in the Value Chain
Brand: US Legal Forms
Price: 59.00 USD
Rating: 4.87 (319 reviews)

Category:

Small Business - Sales and Marketing

State:

Multi-State

Control #:

US-03017BG

Format:

Instant download

Description

The value chain is a concept from business management. A value chain is a chain of activities for a firm operating in a specific industry. The business unit is the appropriate level for construction of a value chain, not the divisional level or corporate level. Products pass through all activities of the chain in order, and at each activity the product gains some value. The chain of activities gives the products more added value than the sum of added values of all activities.

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FAQ

The primary activities of the value chain include inbound logistics, operation outbound logistics, marketing and sales, and service. Secondary activities or the support activities include firm infrastructure, human resources management, and procurement.

Porter's value chain involves five primary activities: inbound logistics, operations, outbound logistics, marketing and sales, and service. Support activities are illustrated in a vertical column over all of the primary activities. These are procurement, human resources, technology development, and firm infrastructure.

Step 1: Identify all value chain activities. Step 2: Calculate each value chain activity's cost. Step 3: Look at what your customers perceive as value. Step 4: Look at your competitors' value chains. Step 5: Decide on a competitive advantage.

The primary activities of Michael Porter's value chain are inbound logistics, operations, outbound logistics, marketing and sales, and service. The goal of the five sets of activities is to create value that exceeds the cost of conducting that activity, therefore generating a higher profit.

Value chain analysis is 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.

The activities associated with this part of the value chain are providing service to enhance or maintain the value of the product after it has been sold and delivered. Examples: installation, repair, training, parts supply and product adjustment.

Assessing the Primary Activities in the Value Chain

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