Porter’s Value Chain

1. Porter’s Value Chain: From Individual Activity Analysis to Integrated Value-Creation Analysis

    flowchart LR
    A["Analyzing individual activities"] -- "Integrated activity analysis from a value-creation perspective" --> B["Porter's Value Chain"]
  

Core: A framework that integrates the analysis of a company’s activities by value-creation stage to identify and optimize the sources of competitive advantage.

Characteristics:
(Primary and support activities) Analyzes the sources of value creation by dividing company activities into five primary activities and four support activities.
(Cost and differentiation strategy) Provides a foundation for establishing cost-leadership and differentiation strategies.

2. Value Chain Analysis Model and Strategic Framework

A. Primary Activities

(Direct activities related to the physical creation, sale, delivery, and support of a product)

    flowchart TD
    ROOT["Primary Activities"]
    
    T1["Inbound Logistics"]
    T2["Operations"]
    T3["Outbound Logistics"]
    T4["Marketing & Sales"]
    T5["Service"]

    ROOT --> T1 --> T2 --> T3 --> T4 --> T5

    style ROOT fill:#1E3A5F,color:#fff
  

• Inbound Logistics: Input-stage activities such as receiving raw materials, storage, and inventory management.
• Operations: The core production activities that transform inputs into the final product.
• Outbound Logistics/Sales/Service: Distribution, marketing, sales, and after-sales support of the finished product.

B. Support Activities

(Activities that enable the primary activities and support overall organizational efficiency)

    flowchart TD
    ROOT["Support Activities"]
    
    T1["Firm Infrastructure"]
    T2["HR Management"]
    T3["Technology Development"]
    T4["Procurement"]

    ROOT --> T1 & T2 & T3 & T4

    style ROOT fill:#28a745,color:#fff
  

3. Expected Effects and Applications