Download The Business Value Chain Model
PNG. Although the terms business model and value chain are often used interchangeably, business model is a related but different concept. A business model focuses on one link or one company in the value chain and describes its operational model:
Understanding how value is created within organizations. How do you change business inputs into business outputs in such a way that they have a greater value than the original cost of creating those outputs? A value chain is a chain of value added activities;
Utilized by firms to create values for their markets.
How do you change business inputs into business outputs in such a way that they have a greater value than the original cost of creating those outputs? Value chain analysis is mentioned extensively in the first half of the book competitive advantage in 1985 by michael porter. As a small business owner, you need to use value chain models for doing strategic cost analysis (which investigates how your costs compare to your competition's costs). The concept of value chain was propagated by michael porter in the 1980s in his book competitive advantage: