What is Porter value chain

Value chain analysis is a process where firm focuses on analyzing its primary and support activities of a.To aid the process of value creation, michael porter developed tool for finding new ways to create customer value, which he refers to as the the value chain.This strategy in turn leads to improved competitive advantage and greater profitability.Adapted with the permission of the free press, a division of simon & schuster, inc.Porter's value chain is a useful strategic management tool.

Porter highlights that organizations gain a competitive advantage when an.It is a framework for developing an analytic structure that follows interdependent activities from raw material acquisition or idea through production and finally, into the hands of a customer.It works by breaking an organization's activities down into strategically relevant pieces, so that you can see a fuller picture of the cost drivers and sources of differentiation, and then make changes appropriately.The value chain model is also known as porter's value chain model.the analysis is a business management tool that was developed by michael porter and described in his popular book competitive advantage:A value chain is a model that states what activities need to be performed to deliver the value proposition to a customer, client, or end user.

In the business process organizations create value, more value creation means a more profitable organization.The approach involves breaking down the firm into five 'primary' and four 'support' activities, and then looking at each to see if they give a cost advantage or quality advantage.Regardless of your role within an organization's management team, learning about porter's value chain can help you create more value for your customers and potentially increase company profits.The porter's 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.