Value chain analysis , Managerial Accounting

VALUE CHAIN ANALYSIS

Every firm is a collection of activities that are executed to design, generate, market, deliver and support its products or services. Value chain analysis is a systematic way of examining all activities that a firm performs and how they interact.

The value chain disaggregates the firm into strategically separable activities in order to understand the behavior of costs so as to create competitive advantage. A firm creates competitive benefits by:

  1. Finding new manner to conduct activities, example, improving efficiency via automation.
  2. Managing the linkages among activities better e.g. spending on better product design may reduce after sales service costs.
  3. Managing the linkages among customers and suppliers better.
  4. Value activities are physically and technologically different activities a firm executes. These are building blocks by which a firm creates products and services valuable to its customers. The value chain by Michael Porter is as shown below.

 

1920_diagram.jpg

Posted Date: 12/8/2012 5:44:26 AM | Location : United States







Related Discussions:- Value chain analysis , Assignment Help, Ask Question on Value chain analysis , Get Answer, Expert's Help, Value chain analysis Discussions

Write discussion on Value chain analysis
Your posts are moderated
Related Questions
Difference between a fixed and flexible budget Fixed budget A fixed budget remains the same irrespective of changed situations. It remains inflexible even if volume of

Disadvantages of standard costing 1) Difficulty in setting standards: setting of standards in practice extremely difficult and complicated task. First it is not possible to f

i want to get the answer for exercises 2.1 and 2.2 on strategic and tactical decisions

Benefit of product life cycle costing The benefits of product life cycle costing are summarized as follows: 1) The product life cycle costing results in earlier actions to g

Relevant costs and benefits for operating decisions: In operating decisions, concentration is on best use of existing capacity. Incremental analysis based on differential cost

Mosman Ltd makes a single product. The projected sales for the first month of the coming year and the starting and ending inventory data are as follows:   Sales  80,000 units Uni

M/s ABC has an existing sales of Rs.50 lakhs and permits a credit period of 30 days to its customers.  The firm cost of capital is 10% and the ratio of variable cost to sales is 85

What are the Features of zero base budgeting 1) Manager of a decision unit has to completely justify why there should be at all any budget allotment for his derision unit. This

When the stock market is going up over a long period of time, investors can become complacent about the risks of being a stockholder. After the significant decline of the stock mar

Limitation of break even charts Despite many advantages a break even chart suffers from the following limitations: 1) A break even chart is based upon a number of assumption