Documenti di Didattica
Documenti di Professioni
Documenti di Cultura
1. How can value chain analysis help identify a company’s strengths and
weaknesses?
Value chain analysis is based on the assumption that a business’s basic purpose
is to create value for its users and its products or services. Value chain analysis
divides firm’s activities into two major categories, i.e. primary activities and support
activities. Primary activities are those activities that are involved in the physical
creation of the product, marketing and after-sales service. Support activities assist
the primary activities by providing infrastructure that allows them to take place on
an on-going basis.
The identification of resource (assets) profile and activity mapping helps easy
analysis of strengths and weaknesses of the firm. When managers assign costs and
assets to each activity, managing internal strengths and weaknesses is much easier
and simpler. Fig 1 shows such activity mapping and allocation of costs to each
activity and also identification of strengths and weaknesses of a firm.