Question

7. Describe the primary activities in a value chain using an example. 8. What is a value chain? List the primary activities in a value chain. 9. Explain value chain linkages.

Answer 1

7,8 & 9)

A Value Chain is the matrix of the operations of a company through which it produces the valuables in the form of Products and Services by using its resources like raw-material, labor and money. The primary activities of a value chain include:

a) Resource logistics: The arrangement of the resources like raw materials, labor, operation facilities and warehouses, offices, etc.

b) Operations: The procedures which collectively convert the raw-materials into a finished product or service.

c) Marketing and Revenue department: The products and services generated are being promoted and priced out to the customer through the Sales and revenue department, where services like advertisement etc. are handled.

d) Allied services: The allied services which helps to maintain the operation, sales and dispatch of products ie. distribution are the important primary part of a value chain. It includes repair & maintenance, HR department, Advertising department, Collection department, etc.

The value chain linkages are the transfer of jobs between the various primary activities of a value chain. The coordination and combination of the activities in creating value or profit for the organization is called the Value Chain Linkages . The Sales department collects the order from the customers, who then directs the production departments to produce the products and services, who in their turn places requirements to the Procurement department and on finishing of the product, the dispatch department is called for final delivery to the customer. Thus a value chain linkages is being created between various activities.