Value Chain as Competitive Advantage

Workers like to know that what they do has a positive impact on the people and world around them. This may be as simple as bringing a smile to a customer’s face, or fixing a problem they have. Happy customers help to make employees happy and keep them motivated. The reward of customer appreciation can go a long way to keeping employees interested in their work on a day to day basis.

In order for a firm to create competitive advantage, it needs to create a set of activites that can deliver value to the specific product and services it offers to its customers. To start talking about my life as a “value chain”, I may need to compare it to a specific product”. This is going to take precedence both in my personal life and professional life.

“Competitive Advantage introduces the concept of the value chain, a general Framework for thinking strategically about the activities involved in any business and assessing their relative cost and role in differentiation”. Michael Porter, (1985).

The value chain is a temporary competitive advantage for Zara. The major reason why it is not a sustainable advantage is that it is not rare. Barney stated that it is not a sustainable resource if a large number of other firms can also gain benefit from the same resource. It is clearly that Zara’s competition also get their global value chain. Therefore, no firm could get a competitive advantage on the common strategy. Nevertheless the value chain is difficult for new entrants to imitate cause it is costly in capital and time. Further, there is not another way

lyas, R., Mohammed, Banwet, D. K., & Shankar, R. (2007). Value chain relationship: A strategy

Successful organizations remain profitable and competitive when achieving customer delight is their overall objective. Designing and implementing an effective value chain is the key to success. When competitive advantage is tied to customer delight then an organization will see growth and profitability. In this paper the interwoven relationship between effective value chain management, profitability, competitive advantage and customer delight will be outlined. All firms make decisions that affect their competitive position and profitability. Strategic planning is the organizational process of making these important decisions. It is undertaken in an

The value chain is understood as a series of activities linked vertically to create and increase value for our customers (Leiponen and Helfat, 2009). Understanding these issues is important because the firm earn above-average returns only when the value it creates is greater than the cost incurred to create that value (Kasper, Mühlbacher and Müller, 2008). Today’s competitive landscape demands that firms examine their value chains in a global rather than a domestic-only context (Haworth, 2013). When using their unique core competencies to create unique value for customers that competitors cannot duplicate, firms have established one or more competitive advantages (Saliola and Zanfei, 2009). Competitive Advantages (strengths) of the business comes from many separate activities in the design, manufacture, marketing, distribution, so on. Each of these activities contributes to reduce the relative cost of enterprise or create a basis differentiation, thereby can creating competitive advantages for

Findings – The findings from this research reveals that the company uses a number of value chain model in creating a vision, an excellent performance management system, development of technology, sales and marketing, logistics and cost

Kotler & Keller (2008) build on this definition, stating that customer satisfaction is determined by “the degree to which someone is happy or disappointed with the observed performance of a product in relation to his or her expectations”. Performance that is below expectations leads to a dissatisfied customer, while performance that satisfies expectations produces satisfied customers. Expectations being exceeded leads to a “very satisfied or even pleasantly surprised customer” (Kotler & Keller, 2003, p. 80).

Customer satisfaction refers to the feeling of gratitude a customer or client gets after purchasing goods or services from a particular firm. Every business must have its tactics to ensure that their customers are contented with the type of service offered or the goods sold and as such will come back anytime when in need of the same type of goods or service. To ensure proper customer satisfaction, the staff must practice good customer engagement.

Value Chain Analysis helps in defining how much buyers are willing to spend for what they get from suppliers. It helps in outsourcing decisions, to understand the link between activities that lead to more optimum make-or –buy decision that would in turn determine whether it’s a cost advantage or a differentiation disadvantage. The value chain framework is an important framework for evaluating the activities in which an organisation can achieve its distinct core competencies. It is to be noted that the value chain analysis, when used suitably, makes the application of competitive strategies more efficient overall.

Value chain analysis has proven to be a useful tool for knowing how an organization can create the greatest value for its customers. Michael Porter (1985) in his book competitive advantage states that “understanding how a business creates value are essential elements for developing a competitive advantage.” [1]. According to porter (1985) value chain is “the process view of an organization, the idea of seeing an organization as a system, made up of subsystems each with inputs, transformation processes and outputs.” [2]. Porter argued further that transforming inputs into outputs involves acquisition and consumption of resources like money, labor, materials, equipment, land, administration and management. Porter highlighted further that the way value chain activities are carried out determines costs and affects the profitability of a business. A much broader definition of a value chain is given by globalvaluechains.org, according to globalvaluechains.org; value chain is defined as the “full range of activities that firms and workers do to bring a product from its conception to its end use.” Globalvaluechains.org states further that the main activities that make up a value chain includes product design, production, marketing, distribution and support to customers. Porter divided business activities of traditional organizations into two main categories; primary activities and secondary activities. The primary activities are directly linked to transforming inputs

The value chain theory was initially developed by Michael Porter (1985) to describe a chain of value-adding activities/functions within an organisation that perform distinctively from competitors to achieve competitive advantage. However, several researchers posit that disaggregation of functions could also be implemented to an inter-firm system (e,g., Christopher, 2005;

The value chain approach was developed by Michael Porter in the 1980s in his book “Competitive Advantage: Creating and Sustaining Superior Performance” (Porter, 1985). The concept of value added, in the form of the value chain, can be utilised to develop an organisation’s sustainable competitive advantage in the business arena of the 21st C. All organisations

More focus has been on driving service quality outcome from the mere customer satisfaction to customer delight and archiving service excellence as the competition in service industries is rapidly growing. The initial study on customer delight suggest that high levels of customer satisfaction will eventually lead to customer delight in the following sequence; arousal ⇒ pleasure (positive affect) ⇒ delight sequence (Oliver et al., 1997). This study revealed that customer delight and customer satisfaction have different effects on customer repurchase