Porter Value Chain Analysis
PORTER 'S VALUE CHAIN ANALYSIS
The porter’s value chain is a model that helps to analyze specific activities through which firms can create value and competitive advantage.
There are two activities in value chain which are: Primary activity – directly concern with creating and delivering a product. Support activities – not directly involved in production, may increase effectiveness or efficiency. PRIMARY ACTIVITIES | DESCRIPTION | Inbound Logistic | * Concerned with receiving and storing externally sourced materials. * Includes receiving, storing, inventory control, transportation scheduling. | Operations | * Manufacture of products and services. * The way that the resource inputs convert to outputs. * Includes machining, packaging, assembly, equipment maintenance | Outbound Logistic | * Required to get the finished goods and services to the customer. * e.g : warehousing, order fulfillment, transportation, distribution, distribution management. | Marketing and Sales | * Associated with getting buyers to purchase the product. * Includes channel selection, advertising, promotion, selling, pricing, retail management, etc. | Services | * Maintain and enhance the product performance after the product has been sold. * Includes customer support, repair services, installation, training, spare parts management, upgrading, etc. |
SUPPORT ACTIVITIES | DESCRIPTION | Procurement | * Concerned how resources are acquired for a business. * Procurement of raw materials, servicing, spare parts, buildings, machines. | Human Resources Management | * Associated with recruiting, development (education), retention and compensation of employees and managers. | Technology Development | * Concerned with managing information processing and the development and protection of knowledge in business. * Includes technology development to support the value chain activities such as research and
The porter’s value chain is a model that helps to analyze specific activities through which firms can create value and competitive advantage.
There are two activities in value chain which are: Primary activity – directly concern with creating and delivering a product. Support activities – not directly involved in production, may increase effectiveness or efficiency. PRIMARY ACTIVITIES | DESCRIPTION | Inbound Logistic | * Concerned with receiving and storing externally sourced materials. * Includes receiving, storing, inventory control, transportation scheduling. | Operations | * Manufacture of products and services. * The way that the resource inputs convert to outputs. * Includes machining, packaging, assembly, equipment maintenance | Outbound Logistic | * Required to get the finished goods and services to the customer. * e.g : warehousing, order fulfillment, transportation, distribution, distribution management. | Marketing and Sales | * Associated with getting buyers to purchase the product. * Includes channel selection, advertising, promotion, selling, pricing, retail management, etc. | Services | * Maintain and enhance the product performance after the product has been sold. * Includes customer support, repair services, installation, training, spare parts management, upgrading, etc. |
SUPPORT ACTIVITIES | DESCRIPTION | Procurement | * Concerned how resources are acquired for a business. * Procurement of raw materials, servicing, spare parts, buildings, machines. | Human Resources Management | * Associated with recruiting, development (education), retention and compensation of employees and managers. | Technology Development | * Concerned with managing information processing and the development and protection of knowledge in business. * Includes technology development to support the value chain activities such as research and