Analysis Without Paralysis: 10 Tools to Make Better Strategic Decisions

Chapter 12. Value Chain Analysis

Description and Purpose

Value chain analysis (VCA) is a used to identify a company’s potential sources of economic advantage and to achieve an optimal allocation of resources. This is done by reviewing its internal core competencies in light of its external environment. A company’s value chain is part of a larger industry value system that includes the value creating activities of all of the industry participants—from raw materials suppliers through to the final consumer. VCA separates the company’s processes into strategically relevant value creating activities. This analysis provides rich insights into industry profit and assists to identify strategies needed to generate competitive advantage.

The unique ...