Sustainable Value Chains-Free-Samples for Students -Myassignment

Question: You are required to write a report discussing Value Chain analysis. Answer: Introduction Strategic Planning refers to the process to define the business strategies of the organizations. Strategic planning plays an integral part in organizational decision-making and it provides the business with necessary direction to achieve its objectives. One of the major parts of strategic planning is Value Chain that helps to add value to the customers. Value Chain Analysis Definition Value Chain Analysis is described as a major strategic tool used by the organizational managers for the analysis of the internal activities of the companies. The main objective of value chain analysis is to recognize the most valuable activities in the organizations (Fearne et al. 2012). Primary Activities There are five primary activities in Porters Value Chain. They are Inbound Logistics like receiving, storing and distributing inputs; Operations that the transformation activities; Outbound Logistics like collection, storage and distribution system; Marketing and Sales that are done to persuade customers; and Services that are done to maintain the value of products (netmba.com 2017). Secondary Activities There are four secondary activities in Porters Value Chain. They are Procurement that is done to get the necessary resources for operation; Human Resource Management that involves recruitment, hiring, motivation and others; Technological Development that are related to management and procurement of information; and Infrastructure that are the support system of the companies. Cost Advantages There are five steps under coat advantage. First step involves the identification of primary and secondary activities. Second step gives importance to each of the activities. The third step involves identification of cost driver for each activity. Step four identifies links between the activities. Fifth activity involves the identification of risk reduction opportunities. Differentiation There are three steps in differentiation advantages. First step involves the identification of value creating activities. Second stage involves the evaluation of differentiation strategies to improve value of the customers. In the third stage, the best sustainable differentiation is identified. Technology In Porters Value Chain Analysis, the activities of technological development are related with the management and processing of organizational information. In addition, it also helps to protect the knowledge base of the companies. The major objectives of this are the minimization of technological costs, to stay up to date with current technologies and to maintain technical excellence (marketingteacher.com 2017). Linkage between Activities Four steps can be seen here. In step one, high-quality assembling process helps in the reduction of costs and defects for quality control and support activities. In step two, plants are located near to the suppliers for the reduction of distribution and purchasing costs. In step three, few models are used for the reduction of assembling costs. In step four, warehousing costs are increased by high order sizes (tutor2u.net 2017). Outsourcing Businesses have the option to outsource the rest of value chain activities in which they are not specialized. Thus, a thorough value chain analysis helps in the outsourcing decisions of value chain. In order to take value chain outsourcing decision, businesses are required to identify the strengths and weaknesses of various value chain activities. Conclusion From the above discussion, it can be seen that value chain helps in adding values to the products and customers of the companies. As per the above discussion, there are various aspects of value chain analysis and the organizational managers are required to consider all these factors into consideration while taking value chain related decisions. References Fearne, A., Garcia Martinez, M. and Dent, B., 2012. Dimensions of sustainable value chains: implications for value chain analysis.Supply Chain Management: An International Journal,17(6), pp.575-581. Marketingteacher.com. (2014).Value Chain Analysis. [online] Available at: https://www.marketingteacher.com/value-chain-analysis/ [Accessed 7 Nov. 2017]. Netmba.com. (2017).Value Chain Analysis. [online] Available at: https://www.netmba.com/strategy/value-chain/ [Accessed 7 Nov. 2017]. tutor2u. (2017).Value Chain Analysis | tutor2u Business. [online] Available at: https://www.tutor2u.net/business/reference/value-chain-analysis [Accessed 7 Nov. 2017].