Sep 15, 2019

Managerial Processes Direct Indirect Value Chain Study Notes

Managerial Processes Direct Indirect Value Chain Meaning

Managerial Processes Meaning Definition

To create a value organization is very important in this era, for better performance and prestige of the organization. How you can convert your business with more value in less cost. What is the fundamentals for organization to stand in the first place. the main important rule is that, Manufacturing companies create value by acquiring raw materials and produce value added something useful. For example Retailers bring multiple products together and offer them in a convenient way to customers. Online services such as shopping, home services, fitting rooms, or other services, provide to customers in a customer-friendly manner, and distributing them to the mass audience. The profit margin created and captured by a company is depend on value created for the customer. The more value an organization creates, the more profit gets. when you provide more value to your customers, you build a competitive advantage and more profit. how your company creates more ways to add more value, is the key element in developing a competitive strategy. Huh. Michael Porter in 1985 wrote in his influential book "Competitive Advantage", that the concept of value chains for the first time. A value chain is a set of activities that an organization undertakes, to create value for its customers. Porter proposed a general-purpose value chain  activities, which increase performance determines costs and affects profits, so this tool can help you for your organization performance and value.
Porter's Value Chain Strategy Skills Training is the process, how human resource management adds value to inbound logistics, operations, outbound logistics, and so on. look for direct, indirect, and quality assurance subactivities Again, look for direct, indirect, and quality assurance activities. How do you use Porter's value chain? What is operations in value chain?
What is value chain in strategic management? What are support activities in Concept of Value Chain, Value Chain Analysis, Value Chain Management. you will learn more about Porter's Value Chain Strategy and Implementation of Value Chain Analysis in this article. Primary activities are the processes directly involved in transforming materials into finished goods, Porter's Value Chain Analysis by Michael Porter also known as Porter's Value Chain Analysis. Which is a great business management concept that was developed by Michael Porter.

Elements In Value Chain

Value Chain does not depends on departments or types of accounting costs, but Porter's value chain focuses on the system, and also focuses to convert inputs into outputs purchased by consumers. Using this approach, Porter described a series of activities for all businesses, and he divided them into primary and supportive activities, which is given below.

Primary Activities

Primary activities are directly related to the physical manufacture, sales, maintenance, and support of a product or service. They include the following activities.

Inbound Logistics Activities

Inbound logistics are all processes related to receiving, storing and distributing inputs internally. Your supplier relationships are an important factor in creating value here.

Operations Activities

Operations are the change activities, which convert inputs into outputs that are sold to customers. Raw input material is given to operation system that converts it into value output product, so operational systems create value.

Outbound Logistics Activities

Outbound logistics activities take your product or service to your customer. These are the things like collection, storage and distribution systems, and they can be internal or external for your organization.

Marketing and Sales Activities

Marketing and sales are the processes you use to convince customers to buy from you rather than from your competitors. This will depend on you, how much benefits you provide, and how well you communicate them, Marketing and Sales Activities are sources of value here.

Service Activities

Service are the activities related to maintaining the value of your product or service to your customers, once they are purchased your products or. Services.

Support Activities

Supporting activities are those activities, which support the primary functions. each support, or secondary, activity play a important role in each primary activity. For example, procurement supports operations, but it also supports marketing and sales with other activities. below are giving Support Activities.

Procurement or Purchasing

Procurement or purchase is the support activities for the organization, that makes the resources necessary to operate. This includes finding vendors and negotiating the best prices.

Human esource management

Human Resource Management main task in a company, to recruits, hires, trains, motivates, rewards, and retains its employees. People are an important source of value for a company, so businesses can make a clear profit with good HR practices.

Technological Development

Technological development activities are related to the management and processing of information, as well as protecting the company's knowledge base. We should focus on cost effective information technology, staying updated with current technological progress and maintaining technological excellence are sources of value creation.


Infrastructure are a company's support systems tasks that allow it to maintain daily operations, such as Accounting, legal, administrative, and general management are examples of essential infrastructure tasks, that businesses can use for their advantage. Now Companies adopt these  primary and support activities as "building blocks" to create valuable products or services.