Value chain - part 1

In this lesson

1. 0:00 Understanding Porter's value chain
2. 0:45 How inputs become outputs through activities
3. 2:18 Generic strategies and competitive advantage
4. 3:31 Primary activities explained
5. 5:58 Support activities and infrastructure
6. 8:00 Creating value through linkages

About this lesson

Porter's value chain breaks down business activities into primary activities (inbound logistics, operations, outbound logistics, marketing, sales, and after-sales service) and support activities (procurement, technology development, human resource management, and infrastructure), allowing you to analyse where you can either reduce costs or differentiate your offering to charge premium prices. You'll explore how different businesses use the value chain depending on their competitive strategy. Cost leadership businesses like Aldi focus on efficiency and cost reduction across activities, while differentiators like Tesla or BMW create linkages between activities to build unique, high-quality products that justify higher prices. The framework shows you how to examine individual activities for improvement and how different parts of the business can work together to create competitive advantage. This concept is essential for papers like E3 Strategic Management and SBL Strategic Business Leader, where you'll analyse business strategy and organisational effectiveness. Understanding how to apply Porter's value chain will help you identify practical ways businesses can compete successfully and improve performance in case study scenarios.

Duration: 9m