Creating and sustaining superior performance by michael e. Managing the value chain, page 2 concept introduction the urgency and immediacy of the current financial crisis that burst into american consciousness in the 4 th quarter of 2008 has left companies around the world gasping for air. Value chain analysis can be used to identify opportunities to gain cost advantageimprove performance and increase competitive differentiation. Porters value chain analysis starbucks by yuta lolap on. The value chain was designed by michael porter in 1985 as a systematic way to examine how competitive advantage develops and to identify where value is added in an organisation. Jan 12, 2017 facebook value chain analysis posted on january 12, 2017 by john dudovskiy value chain analysis is a strategic analytical tool that can be applied to analyse business activities to be able to identify those activities that contribute most the overall competitive advantage of the business. Jul 24, 20 value chain refers to the functional activities of a business that add value to its customers. An analysis of the value chain rather than value added is the appropriate way to examine competitive advantage. Value chain analysis of procter and gamble case study. Harvard business school professor, michael porter, introduced a simple value chain model in his book.
Value chain model, developed by michael porter, is widely used to. The value chain concept was developed and popularized in 1985 by michael porter, in competitive advantage, porter defined value as the amount buyers are willing to pay for what a firm provides, and he conceived the value chain as the combination of nine generic value added activities. The value chain also known as porters value chain analysis is a business management concept that was developed by michael porter. Figure 1 below illustrates the essence of amazon value chain analysis.
Michael porter is from harvard and is famous for thinking in business about competitive strategy. Value chain analysis is a way for businesses to analyze the activities they perform to create a product. In the new marketing era, with the rise of retail and ecommerce, companies have realized that your value chain will be further strengthened if you have better coordination between all departments. Well look at several models he developed including the 5 force model, the value chain and the generic strategies model. Dec 08, 20 the value chain also known as porters value chain analysis is a business management concept that was developed by michael porter. Report 2018 contains a full version of amazon value chain analysis. Our products include powerpoint templates and diagrams, business frameworks, and a guide on developing effective business presentations. Pestel, porters five forces, ansoff matrix and mckinsey 7s model on amazon. Staying one step ahead of the competition with porters value chain.
A value chain is a set of activities that a firm operating in a specific industry performs in order to deliver a valuable product or service for the market. Porters value chain analysis free management books. Enduring ideas and new opportunities professor michael e. It rests on the premise that agricultural markets can significantly affect farm level access to seeds. This presentation introduces a systematic method to conduct a value chain analysis. The paper would do a value chain analysis of the company, apple inc. Valuechain analysis is an analytical framework that assists in.
Strategy is on industry structure and competitor analysis in a variety. Porters value chain what is the value chain of porter. Porters value chain presentation 1 linkedin slideshare. Porter has suggested many ground breaking strategic concepts like porters five forces, competitive strategy, and others. Introduction for a complicated perspective of value, capricious reversal calls need safety it is totally based on grid model disapproving traditional value chain. Value chain presentation template free powerpoint templates. This presentation draws on ideas from professor porters books and articles, in particular, competitive strategy the free press, 1980. Porters value chain model powerpoint template sketchbubble. Organisations that have successfully introduced a value chain have gained a competitive advantage christopher, 1992. Value added selling price less the cost of purchased raw materials has sometimes been used as the focal point for cost analysis because it was viewed as the area in which a firm can control costs. Porters five forces, ansoff matrix and mckinsey 7s model on ikea. With the value chain analysis, porter tried to overcome the limitations of portfolio planning in multidivisional organisations. Porters value chain analysis by michael porter toolshero. Learnppt is your premiere destination for business presentation materials.
Competitive strategy michael porter michael porter competitive strategy porter, michael competitive advantage michael porter competitive advantage competitive advantage creating and sustaining superior performance by michael e. Competitive advantage grows fundamentally out of value a firm is able to. This download comprises a value chain analysis template contained in an ms excel spreadsheet developed on the basis of porter s framework. These value chain analysis templates will guide you to get the analysis right for your company. Primary activities inbound logistics operations outbound logistics marketing and sales service 3. Michael eugene porter is an american academic known for his theories on economics, business strategy, and social causes.
Critical evaluation of value chain analysis used during the strategic analysis process. Valuechain analysis as a tool of strategic accounting. Though, the methodology was originally developed to attain a seamless flow for the overall functioning of an organization, it has gradually made its way in almost every industry. Porter s value chain methodology is a powerful management tool, which delineates the concept of value creation. The companies learn to move ahead of value chain model by the approach of value grid model by finding new. This porters value chain analysis template provides a general overview of business activities. Why such interest for value chainbased policies and investment programmes. Use a value chain example to improve your business and to build a value chain model search this site. Identify over 45 cost takeout opportunities across your corporate value chain.
A value chain is a group of actions that are performed by a company to. The straightforward guide to value chain analysis hubspot blog. Jan 25, 2020 the porters value chain concept says that there is a chain of events which occur in a company right from the procurement of raw materials to the delivery of goods as well as the post sales service. According to porter, it consists of primary activities and support activities, all of which add value to the products or services offered by the business. What is the relationship between producers and other agents in the value chain really about. T he value chain analysis describes the activ ities the organ ization performs and links them to the organizations competitive pos ition. However, for most consultants, the framework is only a starting point or checklist. Definition 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 information was presented to the class on powerpoint slides interrupted. Porters value chain analysis free management ebooks. Value chain analysis describes the activities within and around an organization, and relates them to an analysis of the competitive strength of the organization.
A value chain represents the industrial process starts from raw materialsinputs to end productsservices. Creating and sustaining superior performance porter 1985. The value chain template in powerpoint format includes three slides. The report illustrates the application of the major analytical strategic frameworks in business studies such as swot, pestel, porters five forces, ansoff matrix and mckinsey 7s model on amazon. They might use value chain or another type of analysis in conjunction. Value chain analysis editable slides linkedin slideshare. Value chain michael porter was the first person who introduced the term value chain in his book competitive advantage. Michael porter introduced value chain models in his book competitive advantage.
In his book, porter first time introduced value creation concept. Porters value chain born in 1947 harvard professor wrote book, competitive advantage 2. This is a series of activities that businesses performed so they can deliver their products or services to the marketplace. Porters value chain analysis is a tool that can be used to determine exactly how your company goes about the task of creating value. Business presentation materials powerpoint templates and. You might also want to read the guidelines below about how to use those slides correctly. The value chain the term value chain was used by michael porter in his book competitive adva n tage. Porter harvard business school 14th annual rotman school. Facebook value chain analysis posted on january 12, 2017 by john dudovskiy value chain analysis is a strategic analytical tool that can be applied to analyse business activities to be able to identify those activities that contribute most the overall competitive advantage of the business. Value chain is a remarkable approach to attain a specific task in the most feasible way by following a certain set of operations. Creating good value for customers is complex, and it involves a chain of activities linked to one another. Michael porter defines value chain as a representation of a firms valueadding activities, based on its pricing strategy and cost structure. This book begins by assuming an understand ing of industry structure and competitor behavior, and is preoccupied with how to translate that understanding into a competitive advantage.
According to christopher 1992 suppliers are looking for strategies that will provide superior value in the eyes of the customer. Apple value chain analysis publish your masters thesis. He is credited for creating great works, porter s five forces analysis, competitive strategy, national diamond and value chain. Porter porter competitive advantage 1998 michael porter michael porter 5 forces pdf value chain michael porter strategic management by michael porter. Why such interest for value chain based policies and investment programmes.
Competitive advantages differences among competitor value chains are a key source of competitive advantage porter, 1985 firm infrastructure used to increase efficiency and to cut costs computerized coffee roasters wifi in stores mobile. Additional information may be found at the website of the institute for strategy and competitiveness. Introduction in 2004 esa initiated a research program on agricultural markets and their relationship to farm level decisions on utilizing crop genetic resources. Value chain analysis is mentioned extensively in the first half of the book competitive advantage in 1985 by michael porter. The value chain also known as porter s value chain analysis is a business management concept that was developed by michael porter. No part of this publication may be reproduced, stored in a retrieval system, or transmitted in. Supply chain management logistics powerpoint presentation slides.
Here we have the porters generic value chain which describes a chain of activities. Value chain analysis of procter and gamble case study value chain analysis describes the activities that take place in a business and relates them to an analysis of the competitive strength of the business. A value chain is a set of activities that an organization carries out to create value for its customers. Porters value chain activities diagram in powerpoint 2010 if you are preparing a marketing plan or business strategy for your organization and need the popular porters value chain diagram in your powerpoint slides, then here we will show you how to design a simple but nice enoguh value chain diagram using shapes. It also shows the role of competitive scope in affecting the value chain. Moreover, the report contains analyses of amazon leadership, business. Value added selling price less the cost of purchased raw materials has sometimes been used as the focal point for cost analysis because it was viewed as. Porters value chain born in 1947 harvard professor wrote book. Visualise the presentation full screen or download it as a. Introduction it was introduced by michael porter in 1985, in criticism of his 5 force model.
This download comprises a value chain analysis template contained in an ms excel spreadsheet developed on the basis of porters framework. You should be familiar with the original model see figure 1 and the activities described within it. Porter proposed a generalpurpose value chain that companies can use to examine all of their. Agriculture and rural development includes bibliographical references and index. The value chain analysis sometimes refers to porters value chain analysis model is a wellknown business management tool developed by michael porter in 1985 in his alltime influential book competitive advantage. According to robbins 2009, only depending on value chain analysis, an organization delivers its products or services to its customers fast and quickly. The value chain from competitive advantage, by michael porter. Porter has dedicated much of his career to studying competitive advantage. This chain is made up of 9 steps and the process can be changed in any of the nine steps to add further value to the final product. It is sometimes known as porter s value chain as first described by michael porter in his 1985 bestseller competitive advantage.
It is a means of implementing competitive strategies. Porter s value chain activities diagram in powerpoint 2010 if you are preparing a marketing plan or business strategy for your organization and need the popular porter s value chain diagram in your powerpoint slides, then here we will show you how to design a simple but nice enoguh value chain diagram using shapes. Value chain definition value chain analysis competitive. A business strategy of through a value chain and comparative advantage analysis of amazons trademarks and intangibles amazon is considered the preeminent online retailer in the world. The concept was created around 1985 by michael porter, harvard business school professor. Ikea valuechain analysis is an analytical framework that assists in. Download free value chain templates for powerpoint presentations with awesome slide designs including porters value chain diagrams and other slide designs for value chain analysis using microsoft powerpoint. Value chain analysis canister help to recognize and create actions that support the selected generic strategy some economists assert that the breaches of trust e. Porters value chain analysis starbucks by yuta lolap on prezi. Porter s value chain template for powerpoint and keynote is designed for professional presenters, who are handling business management and corporate management concepts. Porter 1985 introduced the concept of a value chain. Thus, value chain analysis may provide sony with a framework for evaluating relative significance of various activities undertaken by an organisation, from the perspectives of cost and value added robson, 1994. With this, the effect of the efficient development of a robust value chain on the success of the product offerings of the company would be discussed.
An overview of these strategic analysis tools will. One of his bestknown concepts is the value chain, which is used to deliver a product or service to the market and has three key objectives. In his book competitive advantage 1985, michael porter explains value chain analysis. The question of strategic success for large and small firms has shifted from one based on profit. In order to carry out a value chain analysis, it is key to identify activities that. It is a set of activities that an organization carries out to create value for its customers. Definition michael porter published the value chain analysis in.
Value chain analysis is one way of identifying which activities are best undertaken by a business and which are best outsourced. According to michael porter, value chain consists all. Value chain analysis and competitive advantage article pdf available in journal of general management 271. Value chain analysis is a systematic method for disaggregating a firm or industry into its major discrete activities to understand sources of competitive advantage. Guidelines for value chain analysis jon hellin and madelon meijer 3 1. Porters value chain activities diagram in powerpoint 2010. Use a value chain analysis to identify competitive opportunities, improve. Porter proposed a generalpurpose value chain that companies can use to examine all. Creating and sustaining superior performance value chain analysis can be complementary to other types of business. Browse our free strategy concept powerpoint slides and download anything you need by clicking with your right mouse button save target as. Adding value to a product passing through a chain of activities is called porters value chain after michael porter for his discussion of it in competitive advantage.
Free powerpoint slides for strategy concepts success. Value grid, value chain model, supply chain, value chain analysis. The value chain from competitive advantage, by michael. Value chain for a copier manufacturer adapted from porter, 1985 cpp insight although the value chain has been in the public domain for over 20 years, its not often used expressly as part of the strategy development process. As you might have guessed, the value chain is a set of activities that will lead to the creation of value.
Company reports faq new reports terms and conditions contact ebook. The following is an example of the value chain for copier manufacturer. The concept of strategic business units stated that businesses within a conglomerate should act independently while headquarters should be responsible only for budgetary decisions to be based on a business units position in the overall portfolio. Michael porter is a current professor at harvard university and he wrote the well known competitive advantage which defines the strategic advantage one business has over its business rivals.
Strategy is on industry structure and competitor analysis in a variety of industry environments, though it contains many implications for competitive advantage. Above is an image of michael porter who presented the concept of value chain. Michael porter discussed this in his influential 1985 book competitive advantage, in which he first introduced the concept of the value chain. Dec 16, 2016 value chain analysis using porters model 1. The model against which to do this is porters value chain appendix 2. During a market research process lot of information is gatehered and organize this information might be a hard task. The value chain the term value chain was used by michael porter. Value chain porters vrooms expectancy theory the idea of the value chain is based on the process view of organisations, the idea of seeing a manufacturing or service organisation as a system, made up of subsystems each with inputs, transformation processes and outputs. The concept of the value chain was first presented by michael porter in the. Porter suggested that activities within an organisation add value to the service and products that the organisation produces, and all these activities should be run at optimum level if the organisation is to gain any real competitive.