Value-Chain Analysis

In assessing its primary activities, an airline would examine

A.baggage handling. baggage handling involves transfer of service to buyer and is part of airline operations

SWOT is a good starting point,

but it doesn't give enough guidance regarding the specific action steps needed to enact strategic change. For instance, a firm may have a capability that is a strength, but that, by itself, cannot create or sustain competitive advantage. It's too easy to become preoccupied with a single dimension or element of what is, essentially, a moving target

Primary activities

contribute to the direct physical creation of the product or service; the sale and transfer to the buyer; and service after the sale. •Inbound logistics. •Operations. •Outbound logistics. •Marketing and sales. Service.

Value

is the amount that buyers are willing to pay for what a firm provides them and is measured by total revenue, a reflection of the price a firm's product commands, and the quantity it can sell. A firm is profitable when the value it receives exceeds the total costs involved in creating its product or service. Creating value for buyers that exceeds the costs of production (i.e. margin) is a key concept used in analyzing a firm's competitive position.

Value-Chain Analysis

looks at the sequential process of value-creating activities. •Value is the amount buyers are willing to pay for what a firm provides. •How is value created within the organization? •How is value created for other organizations in the overall supply chain or distribution channel? •The value received must exceed the costs of production.