Value Chain

The concept of a "value chain" was first put forth by Michael Porter in Competitive Advantage (New York: Free Press, 1985) as

A set of linked activities that occur to create a product or service, beginning with the acquisition of raw materials through delivery of the final service after sale.

This quote is not from Porter, but is from Rita Gunther McGrath and Ian MacMillan, in The Entrepreneurial Mindset; Strategies for Continuously Creating Opportunity in an Age of Uncertainty (Boston, MA: Harvard Business School Press, p. 94). Wikipedia has an article on it as well. If you want to read more about value chains, get ahold of these sources and read them and their references.

Value chains are important for entrepreneurs to know about. They offer a powerful way of analyzing our businesses by breaking down our businesses into all the steps we have to go through to get our product sold or service delivered. They also give us a way of seeing how we can enhance our services by looking at each step in the chain and see how we can enhance each step. They also hold a key to what new businesses you could create.

What do you think? Post a comment. I'd like to know what you think.

Entrepreneurship informs all my professional activities. For entrepreneurial real estate, go to www.yourstopforrealestate.com/blog and for entrepreneurial writing to www.kearneymusicschoolmurders.blogspot.com