Strategic Case Analysis
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Value Chain Analysis
As propounded by Michael Porter in his 1985 book
“Competitive Advantage”, a Value Chain provides a
structural framework to analyze the primary and secondary
activities of a business. This framework, as shown below,
portrays the business as a value delivery organization. In this
figure, the margin is what the business claims as value from
the customers:
Margin =Value Delivered to Customers – Value Created by
the Business
The above figure depicts that primary activities like inbound
logistics, outbound logistics, operations; and support
activities like procurement, technology development, and
human resource management; are geared towards discerning
value at each of these important activity levels within a
manufacturing organization.
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