Value chain and supply chain with importance and difference

value chain and supply chain

1. Understanding the Value Chain Based on Porter’s Value Chain Framework Presented by [Your Name]

2. What is a Value Chain? A business model that describes the full range of activities needed to create a product or service. Introduced by Michael Porter in 1985. Helps identify areas for cost reduction or value addition. Goal: Gain a competitive advantage by optimizing these activities.

3. Value Chain Structure Divided into two main categories: - Primary Activities: Directly involved in value creation. - Support Activities: Assist and enhance primary activities.

4. Primary Activities 1. Inbound Logistics: Receiving, storing, and managing raw materials. 2. Operations: Transforming inputs into final products (e.g., assembly, manufacturing). 3. Outbound Logistics: Distributing finished products to customers. 4. Marketing and Sales: Creating awareness and persuading customers. 5. Service: Support provided after the sale (e.g., installation, repair).

5. Support Activities 1. Procurement: Acquiring raw materials and other resources. 2. Technology Development: Innovation, research and product design. 3. Human Resource Management: Recruiting, training, and development. 4. Firm Infrastructure: General management, legal, accounting, finance, and strategic planning.

6. Value Chain Diagram [Insert diagram here] Primary activities flow horizontally. Support activities run vertically above them.

7. Example: Apple Inc. Inbound Logistics: Sourcing components globally (e.g., from Foxconn). Operations: Product design and integration in-house. Outbound Logistics: Distribution via Apple Stores and online. Marketing & Sales: Premium branding and global campaigns. Service: AppleCare support, in-store help, online resources. Support: R&D investment, top talent recruitment, strong infrastructure.

8. Conclusion The value chain offers a structured way to analyze business activities. Optimization of both primary and support activities is key. Effective use leads to increased value creation and profitability.