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    Porters Value Chain

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    Deepak Sai
    Porter's value chain model views organizations as systems made up of subsystems that transform inputs into outputs. It identifies primary activities like inbound logistics, operations, outbound logistics, marketing and sales, and services. Secondary activities include procurement, human resource management, technological development, and infrastructure. The value chain aims to understand how activities are carried out and their impact on costs and profits.

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    Porters Value Chain

    Uploaded by

    Deepak Sai
    57 views2 pages
    Porter's value chain model views organizations as systems made up of subsystems that transform inputs into outputs. It identifies primary activities like inbound logistics, operations, outbound logistics, marketing and sales, and services. Secondary activities include procurement, human resource management, technological development, and infrastructure. The value chain aims to understand how activities are carried out and their impact on costs and profits.

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    Porter's value chain model views organizations as systems made up of subsystems that transform inputs into outputs. It identifies primary activities like inbound logistics, operations, outbound logistics, marketing and sales, and services. Secondary activities include procurement, human resource management, technological development, and infrastructure. The value chain aims to understand how activities are carried out and their impact on costs and profits.

    Copyright:

    Attribution Non-Commercial (BY-NC)
    Download as DOCX, PDF, TXT or read online from Scribd
    Download as docx, pdf, or txt
    57 views2 pages

    Porters Value Chain

    Uploaded by

    Deepak Sai
    Porter's value chain model views organizations as systems made up of subsystems that transform inputs into outputs. It identifies primary activities like inbound logistics, operations, outbound logistics, marketing and sales, and services. Secondary activities include procurement, human resource management, technological development, and infrastructure. The value chain aims to understand how activities are carried out and their impact on costs and profits.

    Copyright:

    Attribution Non-Commercial (BY-NC)
    Download as DOCX, PDF, TXT or read online from Scribd
    Download as docx, pdf, or txt
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    Porter's Value Chain

    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. Inputs, transformation processes, and outputs involve the acquisition and consumption of resources - money, labour, materials, equipment, buildings, land, administration and management. How value chain activities are carried out determines costs and affects profits. Most organisations engage in hundreds, even thousands, of activities in the process of converting inputs to outputs. These activities can be classified generally as either primary or support activities that all businesses must undertake in some form. According to Porter the primary activities are: Inbound logistics: Refers to goods being obtained from the organisations suppliers ready to be used for producing the end product. Operations: The raw materials and goods obtained are manufactured into the final product. Value is added to the product at this stage as it moves through the production line. Outbound logistics: Once the products have been manufactured they are ready to be distributed to distribution centres, wholesalers, retailers or customers. Marketing and Sales: Marketing must make sure that the product is targeted towards the correct customer group. The marketing mix is used to establish an effective strategy, any competitive advantage is clearly communicated to the target group by the use of the promotional mix. Services: After the product/service has been sold what support services does the organisation have to offer. This may come in the form of after sales training, guarantees and warranties. With the above activities, any or a combination of them, maybe essential for the firm to develop the competitive advantage which Porter talks about in his book.

    Secondary activities are: 1. Procurement - is the acquisition of inputs, or resources, for the firm. 2. Human Resource management - consists of all activities involved in recruiting, hiring, training, developing, compensating and (if necessary) dismissing or laying off personnel. 3. Technological Development - pertains to the equipment, hardware, software, procedures and technical knowledge brought to bear in the firm's transformation of inputs into outputs. 4. Infrastructure - serves the company's needs and ties its various parts together, it consists of functions or departments such as accounting, legal, finance, planning, public affairs, government relations, quality assurance and general management.

    Marketing-cost analysis:
    Marketing-cost analysis is assigning or allocating costs to a specified marketing activity or entity in a manner that accurately captures the financial contribution of activities or entities to the organization.

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