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VALUE CHAIN ANALYSIS (VCA)
Transcript of VALUE CHAIN ANALYSIS (VCA)
Michael Porter: The Value Chain
How to do VCA
VCA: What is it?
Analysis of activities in the VC to identify competitive strength for a business
Simple VC of a Cake
Value Chain (VC) : Organizational activities ranging from raw materials, to the final product for the consumer.
WHY VCA IS DONE
Optimal allocation of resources
Value-creating activities: Competitive advantage
Potential sources of economic advantage
OBJECTIVES OF VCA
1. Secure cost advantages
2. Create differentiated products for customers
Firm Infrastructure Human Capital Management
Procurement Systems and Technology
• Resources and capabilities: sustainability
• Encourages delivery of value to customer
• Exemplifies existing SWOT analysis
• Understanding relative competitive position
• Pace at which technology and customer demands change
• Data required is expensive
• Time-consuming analysis
• Not compatible with internal accounting data of a firm
1. Define Strategic Business Units
2. Value-Creating Activities
3. Internal Cost Analysis
4. Internal Differentiation Value Analysis
5. Industry Profit Pool
6. Vertical Linkage Analysis
1. GATHERING INGREDIENTS