Value Chain Analysis and Strategic Management Accounting

Finance strategic management

TABLE OF CONTENTS
Question 1........................................................................................................................................3
Question 2........................................................................................................................................4
References........................................................................................................................................7

QUESTION 1
It is becoming more complex to manage value chain in practice by making use of pre-defined
templates as well as simple software solutions. It can be said that value chain analysis is not a
simple achievement, certain difficulties engage while collecting data, determining the tasks that
can blend actual or perceived value, establishing and deploying the plan (Thompson and Smith,
2017). In addition, it is not easy to search out for suitable information to break the value chain
into supporting as well as primary activities. I do agree with the fact that the value chain appears
good on paper but is difficult to apply in practice it is because of the determination of suitable
revenue costs, assets and revenue for every value chain activity. However, for accomplishing
competitive edge, value chain analysis really helps; it helps in delivering more value at an equal
or reduced cost (Alfaro et al. 2019).
The value chain is referred to as the method for identifying the crucial path to improvise the
customer value at the same minimizing costs. It means those activities that occur in the firm to
serve a valuable product in the marketplace, with the aim of determining areas and activities that
will be beneficial from change to enhance profitability and efficiency. The difficulty in carrying
out value chain analysis is that often the overall strategy and aims of the company gets vanished
at the time when operations are segregated into segments (Donova and et al. 2015). the extent
and direction of the value chain can be hostile at certain times, it takes a lot of contributions,
efforts to complete the value chain and for the main competitors so that a firm can identify key
drivers and differences.
It can be said that the value chain is difficult to apply. However the concept of the value chain
can be effectively implemented by supply chain and operational experts, but it is not true that it