Porters-Value-Chain-Analysis.pptx.ppt
- 1. Porter’s Value Chain Analysis www.noteslearning.com
- 2. Introduction ❑ Value chain represents the internal activities a firm engages in when transforming inputs into outputs. ❑ Value Chain Analysis (VCA) is a strategy tool used to analyze firm’s activities by recognizing which activities are the valuable to the firm and which ones needs to be improved. ❑ It involves identification of primary and supportive activities that add value to the final product. ❑ Michael Porter introduced Generic Value Chain Model in 1985. www.noteslearning.com
- 3. Porter’s Value Chain Analysis Firm Infrastructure (Financing, Planning, Investor Relation, Organizational Structure) Human Resource Management (Recruiting, Training, Compensating, Grievance handling) Technology Development (Product Design, Testing Facility, Market Research, Enterprise Resource Planning) Procurement Resources (Components, Machinery, Vendor, Advertisement, Services) Inbound Logistic Receiving Data Storing Inventory Control Transportation Scheduling Operations Manufacturing Assembly Testing Daily Operation Outbound Logistic Warehousing Order Fulfilment Dispatch Transportation Marketing And Sales Advertisement Selling Promotion Pricing Service Customer Service Upgrading Training M A R G I N S U P P O R T P R I M A R Y www.noteslearning.com
- 4. Primary Activities ▪ Inbound Logistics – Raw Material Handling and Warehousing ▪ Operations – Transforming Inputs into the Final Products ▪ Outbound Logistics – Warehousing and Distribution of Finished Goods ▪ Marketing & Sales – Communication, Pricing and Channel Management ▪ Services – Installation, Repair and After-Sales Support Primary activities are directly involved in transforming inputs into outputs and in delivery and after sales support. www.noteslearning.com
- 5. Value Chain of LLOYD AC. PRIMARY ACTIVITIES Inbound Logistics Operations Outbound Logistics Marketing and Sales Services & Support Manufacturing of A.C. into a finished product Transporting A.C.to Distributors and Wholesalers Purchase of Raw Material & Components ▪ Installation ▪ Repair ▪ After Sales Servicing ▪ Segmentation ▪ Targeting ▪ Branding ▪ Pricing ▪ Advertising ▪ Promotional Offers www.noteslearning.com
- 6. Porter’s Value Chain Analysis Firm Infrastructure (Financing, Planning, Investor Relation, Organizational Structure) Human Resource Management (Recruiting, Training, Compensating, Grievance handling) Technology Development (Product Design, Testing Facility, Market Research, Enterprise Resource Planning) Procurement Resources (Components, Machinery, Vendor, Advertisement, Services) Inbound Logistic Receiving Data Storing Inventory Control Transportation Scheduling Operations Manufacturing Assembly Testing Daily Operation Outbound Logistic Warehousing Order Fulfilment Dispatch Transportation Marketing And Sales Advertisement Selling Promotion Pricing Service Customer Service Upgrading Training M A R G I N S U P P O R T P R I M A R Y www.noteslearning.com
- 7. Support Activities ● Firm Infrastructure refers to an organization’s structure and its management, functions, planning, accounting, finance, quality-control mechanism. Firms infrastructure can be a powerful factor for competitive advantage. ● Procurement Resources refers to the function of purchasing inputs used in the firm’s value chain. This function adds value to the company by employing required inputs and effectively managing the firm’s cost. www.noteslearning.com
- 8. Support Activities ● Technology Development incorporates a wide range of technology-related activities to improve the product and the process. Technology development plays a prominent role in differentiating and having competitive advantage ● Human Resource Management consists of activities involved in recruitment, hiring, training, development, compensation of all type of human manpower. It supports both the primary activities and the entire value chain. www.noteslearning.com
- 9. ● Cost Advantage ● Competitive Advantage ● Profitability Need for Value Chain Analysis Value Chain Competitive Advantage Higher Profitability www.noteslearning.com
- 10. ● Firm Infrastructure ○ 800 plants over 200 countries and territories ○ Market Capitalization: $235.35 Billion ○ Advertisement : $5.8 Billion ○ Largest Distribution Network ● Procurement Resources ○ Coca-Cola Bottlers’ Sales and Service ■ Customer Business Solution : a data and service integrator of/for stakeholders ■ Procurement: Navigate external marketplace channels and categories and supplier insights to solve client needs. Support Activities: The Coca-Cola Company www.noteslearning.com
- 11. ● Technology Development ○ Product Innovation: Sugar free products, Greener packaging ○ Sustainable Innovation: “Zero-Waste Urban Environment” ○ Marketing Innovation: Digital Platform and Big Data Analysis for accessing customers choice and forming strategies accordingly. ● Human Resource Management ○ Payments and Rewards ○ Employee Engagement Programs ○ Trainings and Education ○ Performance management Support Activities: The Coca-Cola Company www.noteslearning.com