Michael Porter published the Value Chain Analysis in 1985 as a response to criticism that his Five Forces framework lacked an implementation methodology that bridged the gap between internal capabilities and opportunities in the competitive landscape. This framework focused on industry attractiveness as a determinant of the profit potential of all companies within that particular industry. However, significant differences in performance exist between companies operating within the same industry that can be explained either by the company's participation in a successful strategic group or by a firm's specific competitive advantages.
By subdividing an organization into its key processes or functions, Porter was able to link classical accounting to strategic capabilities by using value as a core concept, i.e. the ways a firm can best position itself against its competitors given its relative cost structure, how the composition of the value chain allows the firm to compete on price, or how this composition allows the firm to differentiate its products to specific customer segments.
Lucintel provides complete visibility to the value chain of a market from material suppliers to the end customer. For each node of the value chain, we identify industry profitability, attractiveness, competition, trends and opportunities. We interview customers, suppliers and competitors at each node of the value chain to get clear picture on the health of the market and thus provide you near real-time strategic insights and intelligence so that you make confident business decisions.