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Course & Subject Guides

Strategic Management - CBA - Oakland Campus

Value Chain Analysis

Your assignment tips say to "Identify value chain activities, linkages and costs to create your profit story." You'll need to use all sorts of information to do so. As you go, "keep in mind how activities and their linkages influence customers' willingness to pay."

Business Margins

"a. Find or estimate the margins for your business - operating income/revenues in Mergent is one approach, or EBIT% or something similar."

Value Chain Diagram

"b. Create a value chain diagram by identifying your business's set of value chain activities." Here you'll need to consult a variety of sources. We highly recommend you use the following: 

Cost Structure

"c. Place the costs associated with value chain activities for your industry/business shown in the Competitive Landscape tab of IBIS World." 

Cost Drivers

"d. Identify the cost drivers for your industry/business (Industry Performance tab in IBIS World). How do changes in the cost drivers impact the costs associated with the value chain activities and ultimately margins? (i.e. how sensitive are your business's margins to changes in cost drivers?"

Diagram, including linkages

"e." In the diagram, illustrate the 2 or 3 core capabilities by including their linkages (trade-off, vertical, coordination) (see the Harlequin example)."

You should have gathered this information in the above steps/resources.

Value Proposition, Strategy, Tag Line

"f. Identify your business's value proposition, generic strategy and tag line."

You likely have found this already, but if not, try the following:


"g. Conduct a VRIO assessment (benchmarking)"

Identify Issues and Opportunities

"h. Given all of the above, identify 2 of 3 issues. You should also identify opportunities to make changes in the value chain that would increase the spread between willingness to pay (WTP) and costs. Keep in mind that activities designed to increase the WTP have associated costs."