1. Value Chain Analysis
ACT ‘C’ Group III
YeshiWangchuk (404)
Sonam Rabgay (100)
Damchoe (217)
DamchoeWangchuk (060)
Melam Rinzin (277)
Choki Gyeltshen (412)
Born in 1947
Harvard professor
Wrote book, Competitive Advantage
2. Firm Infrastructure
Human Resource Management
Technology Development
operations
Marketing
& Sales
Outbound
Logistics
Inbound
Logistics
Procurement
Services
Primary Activities
Support
Activities
Figure 1: Porter’s Generic Chain
3. Primary Activities
Inbound Logistics
The receiving and warehousing of raw materials
Distribution of raw materials to manufacturing and
operations
10. Support Activities
Human Resource Management
Activities associated with recruiting, training, hiring,
and compensation
11. Support Activities
Firm Infrastructure
Includes general and planning management, legal,
finance, accounting, public affairs, and quality
management
Ex. A firm’s legal team consisting of lawyers to aid in
lawsuits
Accounting department to keep track of financial
figures
12. Why this matters
Profits depends on how well firms execute these
activities in the value chain
Firms that excel in a value chain activity is said to have
a competitive advantage
Competitive advantage is gained through cost
advantage
Cost Advantage
Reducing cost of individual value chain activities
Reconfiguring the value chain
13. SERVICE BASED WALLMART’S VALUE
CHAIN
Business
Infrastructure
Human Resource
management
Technology
Development
Primary
Activities
400 Plus Truck-Tractors, 30000 square foot stores for small town
Top management spending bulk of time within stores, employees called as
associates, incentives and profit sharing, stock purchase, Decentralization
Uniform Product Code (UPC) at point of sale, Cross docking, Satellite
Marketing
& Sales
Network
Outbound
Logistics
Operations
Inbound
Logistics
Services
Very low
cost as 2%
(half of
industry
average)
9 to 9
working
hours ,
7 days of
week
Strong
presence
of
distributio
n centers
Every day
low price.
Always
low price,
cash and
curry
Quick
response,
No
question
asked
policy on
returns.
Supportive
Activities
Procurement
Good bargaining power with vendors, No vendor accounting for more
than 2.8% of total purchase.
14. Value Chain & Value System of TATA motors
Inbound
Logistics
Transporters, Convoy
Drivers Association
SAP , VCM
Operations Marketing
&
sales
Service
Outbound
Logistics
Suppliers , Contractors
SAP , CRM - DMS
Strategic Alliances
Dealer Network, Marketing
Research Firms, Vehicle
Financing
Regional Warehouses,
Dealer Workshops,
Distributors, TASS
Hinweis der Redaktion
Michael Porter is a current Professor at Harvard University and he wrote the well known Competitive Advantage which defines the strategic advantage one business has over its business rivals.
Inbound logistics include the processes like receiving, storing, inventory control, transportation planning. The relationship between suppliers are very important here because they play a major role in the distribution of raw materials.
In Operations the processes that occur are machining, packaging, assembly, equipment maintenance, and testing. Here is where the transformation starts and products come to life and are then sold to customers.
In outbound logistics some of the Processes include: warehousing, order fulfillment, transportation, and distribution management. The products are then sent to Apple for sale
In Marketing and sales the Processes include:advertising, promotion, selling, and retail management
Examples: customer support, repair services, training, and installation
Examples: R&D, process automation, design, redesign
SAP is an enterprise resource program that supports various business functions in the value chain. It has financial support features to support accounting in the firm’s infrastructure, human capital management support to help HR management, and operations support to aid in the firm’s operations and procurement.
Walmart’s Retail Link system helps keep inventories costs low and procurement costs down