Menu

a firm’s value chain is the set of business activities in which it engages to develop

a firm’s value chain is the set of business activities in which it engages to develop, produce, and market its products or services’ (p. 91). The concept of the value chain also provides a way of tracing the numerous factors that may affect the value and cost of the final product or service. It helps in identifying potential valuable resources and capabilities controlled by a firm. In so far as competitive advantage can only result from providing better value to the customer or from providing comparable value to the customer at lower cost, the value chain is an important tool for understanding the source of competitive advantage.