Porter (1986)

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The Value Chain

The value chain categorises activities into how they create value for the firm.
Primary activities are involved in the physical creation of the product or service.
Secondary activities enable the primary activities to take place. In the picture they are stretched across all of the primary activities, as they are needed throughout the entire process.

Infrastructure includes things like general management, accounting, legal, finance and strategic planning. Pg15

Activities in the chain are interconnected by what Porter refers to as “linkages”.
For example, if more is spent on the purchase (procurement) of raw materials, then a firm can lower its cost of fabrication or assembly.
It is a delicate ecosystem

(For more information, see GSM Lecture 4)

The Value System

Competitive scope

Configuration and co-ordination of activities

Configuration and co-ordination of activities continued