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.,1,InternalAnalysisValueChain,VicSaunders,.,2,WhatisaValueChain?,Avaluechaindescribesthecategoriesofactivitieswithinandaroundanorganisation,whichtogethercreateaproductorservice.,.,3,ValueChain,Astructuredframeworkforexaminingcostsandperformance.Itprovidesasoundbasisforinter-firmcomparisons.Allowscompaniestoimproveperformanceandeffectiveness.Identifyareasinwhichtheycanaddcustomervalue.,.,4,TheValueChainWithinanOrganisation,.,5,PrimaryActivities,InboundLogisticsactivitiesconcernedwithreceiving,storingandtheinternaldistributionofrawmaterials.Operationsthemeansbywhichrawmaterialsareconvertedintothefinalproduct.OutboundLogisticsactivitiesthatrelatetotheprocessofdeliveringtheproducttothecustomersuchasstorage,warehousingandtransportation.,.,6,PrimaryActivities,MarketingandSalesinvolvesmakingsurethecustomersareawareoftheproduct.Serviceincludesactivitiessuchascustomerservice,after-salesservice,installationandtraining.,.,7,SupportActivities,FirmInfrastructurethisrelatestotheorganisationalstructure,cultureandsystems.HumanResourceManagementrecruitment,trainingandrewardingofstaff.TechnologyDevelopmentincludesR&D,ITandprocessimprovements.Procurementpurchasingofvariousinputs.,.,8,UsingtheValueChain,Byusingthevaluechainafirmcangaincompetitiveadvantageby(Porter1998):Inventingneworbetterwaystodotheactivities.Combiningtheactivitiesinbetterways.Managinglinkagesbetterinthevaluechainandthevaluenetwork.,.,9,LimitationsoftheValueChain,Themodelhasanumberoflimitations(Meeketal2003):Itisnoteasytouse,particularlyforserviceorganisations.Itisveryinwardlyorientated,ratherthanbeingfocusedontheexternalenvironment(inparticularthemarketandcustomers).Inmostindustriesasingleorganisationrarelyundertakesallthevalue-creatingactivitiesandthereforeanyanalysisshouldrecognisethewidervaluesystem.,.,10,WhatisaValueNetwork?,Avaluenetworkisthesetofinterorganisationallinksandrelationshipsthatarenecessarytocreateaproductorservice.,.,11,ValueNetwork,Thevaluechaincanbeextendedtoincludesuppliersanddistributors.Itcanbeusedtoanalysetherelationshipbetweencompaniesandtoidentifywaysofaddingvalueinthesupplychain.Porter(1998)referstothisasthevaluenetwork.Forexample,inarestaurantthequalityofingredientsisdeterminedbythegrower.Inessencethegrowerhasaddedvalue.,.,12,TheValueNetwork,.,13,UnderstandingtheCapabilitiesinRelationtotheValueNetwork,Whichactivitiesarecentralimportanttoorganisationsstrategiccapability?Wherearetheprofitpools?Whatshouldbeoutsourced?Whomightbethebestpartnersinthepartsofthevaluenetwork?,.,14,StudentActivity,Insmallgroupsprepareabriefingpaperon:Howawashingmachinemanufacturercouldimproveeachareaofthevaluechaintohelpgaincompetitiveadvantage.,.,15,PrimaryActivities,InboundLogisticscarefulhandlingtoensurenodamagetoincominggoods,easeofaccesstothem,linkingofpurchasestoproductionrequirements.Operationshighquality,fewrejections,deliveryontime.Outboundlogisticsrapiddeliverywhereandwhencustomersneedit.Marketingandsaleswelltrainedandmotivatedsalesforce,advertisingtiedtomarketsegments,goodliterature.AfterSalesServicerapidinstallation,speedyaftersalesserviceandrepair.,.,16,SupportActivities,Procurementpurchasinghighqualitymaterials,regionalwarehousingoffinishedproducts.TechnologyDevelopmentdevelopmentofuniquefeatures,newproducts,useofITtomanagelogisticsmosteffectively.HumanResourceManagementhighqualitytraininganddevelopment,recruitmentoftherightpeople,appropriaterewardsystems.FirmInfrastructureinvestmentinsuitablephysicalfacilitiestoimproveworkconditions,supportfromseniormanagementincustomerrelations,investmentinITsystems.,.,17,PossibleExamQuestion,Asaconsultantyouhavebeenasked,asaninitialstep,touseastructuredframeworktoexaminethecorecapabilitiesandperformanceofVirginAtlantic.Inparticularyouhavebeenaskedtoevaluatetheusefulnessofthevaluechaininanalysingtheirperformanceanddemonstratehowtheyhaveusedittoaddvalueineachoftheareas.,.,18,ExtendedKnowledge,Forfurtherread
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