How do you conduct a value chain analysis to assess your business's activities and performance?

To conduct a value chain analysis, start by identifying all primary and support activities involved in your business's processes, such as inbound logistics, operations, outbound logistics, marketing, sales, and after-sales services. Next, evaluate the value and cost associated with each activity to determine how they contribute to customer satisfaction and overall efficiency. This involves assessing how each step adds value and identifying any inefficiencies or areas for cost reduction.

In my experience, with governments increasingly void of vision/expertise & more about self interest there is a growing need for organisations not only to create sustainable profit but also to create welfare havens for both its customers and staff alike in the same way some of those Victorian brands emerged at the end of the 19th Century eg Bourneville and Lever Brothers. Corporate Social Responsibility is evolving to ensure we share wealth and by doing so we sustain fabric of society and protect customers of the future (as well as communities). We have created not for profit organisations that inwardly help us create opportunity for our business and staff but also to provide added value for our customers and the communities we operate in.

To conduct a value chain analysis, map out your primary and support activities, analyze the costs and benefits of each, and identify value drivers and sources of differentiation. Develop improvement strategies to increase value and reduce costs, while benchmarking against competitors to identify areas for enhancement. Align your activities with customer preferences to optimize operations and gain a competitive advantage. By systematically assessing your business processes, you can enhance value creation and improve overall performance.

In my experience, listing all the major activities involved in the business and categorizing them into primary activities and support activities will provide you with a solid base to build your analysis properly

Simply learn what you do best, focus and exploit those talents within your organization and succeed. Meet the market with your best traits and learn how to exploit them this well develop a winning team.

There are also social and environmental costs & benefits that customers care about and will provide extra value to them. Most companies only think of the traditional costs and benefits which effects their bottom line. However, in today's business climate, companies providing value through social prosperity or environmental protection are gaining competitive advantages due to being able to provide their customers with the ease of mind that their products/services are not contributing to the destruction of our planet or society. Including these environmental and social costs and benefits in your analysis will allow you to fully understand the value your company brings to its customers.

Time-Cost-Quality triangle would be a complete framework to assess any corporate activity i.e.: primary or support activities or even change scenarios. In essence, this also applies to all strategical corporate activities. One should enhance analytical mindset to exquisitely pinpoint technical and non-technical interfaces in between disciplines and departments in order to be able to accurately draw the impact. Thus, the manager will be able to efficiently identify entailing costs. In project management, 'change' must be planned in order to identify time impact of the new initiative and in conjunction, cost estimation (e.g.: Earned Value Management) would define its feasibility that feeds back the result into time estimation retrospectively.

Technology solutions can certainly help with identifying costs associated with each activity, however, without management buy-in and cross-sectional business engagement in cost allocation, the exercise may be futile and not drive decision-making which, is the ultimate purpose of this activity. Hence, building a value chain analysis with an inclusive approach is the only way to really bring about tangible change.

Analyzing the costs and benefits of each activity in the value chain is crucial for understanding the business's financial health and overall performance. To calculate the overall value chain's costs and benefits, we would need specific data and financial figures from the startup. Using a spreadsheet or financial software tool, you can enter the actual costs and estimated benefits for each activity and then sum them up to get the total costs and benefits for the entire value chain.

Identify the primary and support activities and then assess each activity's contribution to the overall value chain. Determine how each activity adds value to your products or services and how it differentiates your business from competitors. -Analyze which activities are the most costly and the factors that drive these costs. -Evaluate how your business performs each activity compared to competitors. -Understand how each activity affects the value perceived by your customers. - Based on the analysis, identify areas where your business can improve its activities, processes, or resources to enhance value creation and competitive advantage. -Develop an action plan to implement the identified improvements.

A much better way than SWOT is a SOAR analysis, as it takes a more positive approach. SOAR stands for Strengths, Opportunities, Aspirations, and Results. Here's how the SOAR analysis framework works: 1. Strengths: Identify and leverage your organization's existing strengths and capabilities. Focus on what your company does well. 2. Opportunities: Identify external factors or trends that could create opportunities for your organization's growth or success. 3. Aspirations: Clearly define your organization's vision and goals. What do you want to achieve? Use this as a guide to steer your strategic decisions. 4. Results: Determine the specific outcomes or results you want to achieve. Think about the measurable impact and the desired state

Company's sources of differentiation are greatly defined by the gap in the market and company's level of responsiveness. Whether the business is fulfilling the gap and how will ultimately highlight essential corporate activities as firm's 'value drivers'.

Apart from the industry opportunities and threats, the business needs to also look at the PEST analysis (political, economic, social, and technological) to ensure it is considering the larger economic landscape and its impact on its competitive advantage. This, alongside Porter's 5 forces: 1) Competition in the industry 2) Potential of new entrants into the industry 3) Power of suppliers 4) Power of customers 5) Threat of substitute products Should be put in perspective to complete coverage of perspectives.

As a C-level executive of the technology-enabled home cleaning services startup, my perspective on value drivers and sources of differentiation would focus on overarching strategies and the alignment of various departments to achieve a competitive advantage in the market. I would focus on aligning our strategies and resources to maximize our strengths and address weaknesses and gaps. This would involve fostering a culture of innovation, investing in marketing and brand building, exploring strategic partnerships, and leveraging data to make informed decisions.

The first point is to forget the traditional organisation and think only for process point of view. You will discover thath the value processes (only three) are strongly connected and you cant improve one cosidering them separately. In my experience a full map of all processes could be a correct starting point.point. When to act only on one the all map is modificated.

Identification of areas for improvement is a tactical perspective of successful managers. Adaptation of 'data analysis' tools sampling with clear view of the element and variables under study has made it easy for managers to initiate this. However, classical subjective approaches, such as brainstorming and users' comments, should not be underestimated. At the end, any given improvement, is a 'change' scenario that needs to be systematically dealt with, understanding its impact on time, cost and quality by identification of intersecting departmental interfaces, using right frameworks and standards.

The development & execution of improvement strategies, informed by a value chain analysis, play a pivotal role in augmenting business value & curbing costs. These strategies might encompass optimizing processes, outsourcing, automation, investing in modern technology, enhancing skills, or devising new products or services. These initiatives can bolster efficiency, productivity, and innovation, & heighten the competitiveness of the business. The ultimate objective is to convert the insights gained from the value chain analysis into practical strategies that perpetually refine the business, keeping pace with shifts in market dynamics and organizational goals.

It is important to first define your goals,targets or aspirations then trace backwards all the critical process, teams, activities and initiatives that directly affects the value and result of that goal. From that map out non negotiables. For those that do not directly contribute to the goal, asses why it is needed, is it for license to operate, compliance or it is already non value adding. Once analyzed and clearly defined the impact,follow through on prioritization as well as start, stop, continue decisions that has to be made. The last part is the most challenging but if mapping out of activities, process and initiatives are appropriately done, there should be enough data to support the decisions to be taken.

Don't forget old tools that still work. The Pareto principle, commonly known as the 80/20 rule, states that 80% of effects come from 20% of causes. In the context of a value chain, this could mean that a significant majority of a product’s value is derived from a relatively small proportion of activities. By identifying and focusing on these high-value activities, a company can maximize its efficiency and effectiveness. This principle can be visually represented through a Pareto chart, a type of graph that displays causes and their effect in a company. It's a simple yet effective tool for prioritizing and targeting efforts to areas where they can have the greatest impact.

There are also times when the business may be ground breaking and therefore the value may not always be evident to the customers at first. So, if that is the business strategy then that definitely needs to be taken into consideration. In the words of Henry Ford, "If I had asked people what they wanted, they would have said faster horses” - the customer may fail to see the value of the car at the beginning.

In order to deliver what customers want to buy and survive the competition, companies need to make smart decisions about the strategy they want to implement. The main objective of value chain analysis is to determine what adds value to your system in order to lead the competition. The best and most robust strategy will be linked to the soul of your business, the vision. Whatever strategy you choose, customers will perceive value from the soul of your business. For example, in Port and Maritime Consulting, we have focused on training the consultants according to the vision to build and expand the reputation of the business.

Os relatórios contábeis e financeiros permitem analisar o desempenho econ?mico-financeiro. ESG amplia essa análise para os ativos n?o financeiros, que contabilizados (como se faz no momento de valuation) ampliam a vis?o mais realista do verdadeiro desempenho de cada negócio. Ambiental, Social e governance.