Value Chain V Supply Chain
Value Chain Vs. Supply Chain
Value Chain versus Supply Chain
Value chain is a systematic approach to examine the development of competitive advantage and it consists of a series of activities that create and build value. In addition, it categorizes the generic value-adding activities of an organisation.
The supply Chain key areas of concerns are forecasting, purchasing, production planning, warehousing and distribution; In addition, manufacturing of the product and its distribution.
Additionally, the value Chain is included in the supply Chain in which account for value added activities as demonstrated in figure 1. Value Chain starts from the customer view of the key reason of why the product would be worth their time and money; whereas the supply Chain starts from product components, and then distributed to the customer.
Figure 1
Comparisons of value Chain with supply Chain (Feller, Shunk, Callarman 2006, p. 365)
Is there any real difference between a supply chain and a value chain?
To answer the question of the existence of a difference between supply chain and value chain, it is necessary to define the terms separately, even if they are often confused or interchanged.
The supply chain is the succession of processes and actions aimed to get the product from its original state (raw material), to carry it between the factories and to the customer’s hand. Supply chain can also include the transportation from the customer to recycling companies after the use of it. Supply chain is related to customer’s need in the way that it will change depending on the customer’s need. For example, a change from poor quality to good quality of the products will change the purchasing process and maybe transportation process.
Value chain is a different notion. It is the succession of processes, actions and services aimed to add value to the item. It includes the steps of fabrication of the product, but also the services provided to the customer such as customer
Value Chain versus Supply Chain
Value chain is a systematic approach to examine the development of competitive advantage and it consists of a series of activities that create and build value. In addition, it categorizes the generic value-adding activities of an organisation.
The supply Chain key areas of concerns are forecasting, purchasing, production planning, warehousing and distribution; In addition, manufacturing of the product and its distribution.
Additionally, the value Chain is included in the supply Chain in which account for value added activities as demonstrated in figure 1. Value Chain starts from the customer view of the key reason of why the product would be worth their time and money; whereas the supply Chain starts from product components, and then distributed to the customer.
Figure 1
Comparisons of value Chain with supply Chain (Feller, Shunk, Callarman 2006, p. 365)
Is there any real difference between a supply chain and a value chain?
To answer the question of the existence of a difference between supply chain and value chain, it is necessary to define the terms separately, even if they are often confused or interchanged.
The supply chain is the succession of processes and actions aimed to get the product from its original state (raw material), to carry it between the factories and to the customer’s hand. Supply chain can also include the transportation from the customer to recycling companies after the use of it. Supply chain is related to customer’s need in the way that it will change depending on the customer’s need. For example, a change from poor quality to good quality of the products will change the purchasing process and maybe transportation process.
Value chain is a different notion. It is the succession of processes, actions and services aimed to add value to the item. It includes the steps of fabrication of the product, but also the services provided to the customer such as customer