Value Chain Analysis for Competitive Online Learning Programs

This essay provides a detailed analysis of the value chain and its application in developing online learning programs. It explains value chain analysis and addresses the four industry competitive forces—competitive rivalry, bargaining power of buyers, bargaining power of suppliers, and the threat of substitute products and new entrants—that need to be identified and understood when conducting such an analysis. The paper conceptualizes a methodology using a qualitative approach for conducting a value chain analysis for an online learning program, emphasizing elements such as mapping the supply chain, identifying governance structures, exploring upgrade areas, assessing benefits, evaluating market demand, and examining infrastructure and technology development. The analysis concludes that while competitive rivalry and supplier power are low, buyer power and the threat of new entrants are moderate, and the threat of substitutes is high, highlighting the importance of strategic implementation for online learning programs. Desklib provides a platform for students to access similar solved assignments and study resources.

Running head: VALUE CHAIN ANALYSIS 1
Application of Value Chain Analysis in an Online Learning Program
Student’s Name
Institution Affiliation
Date of Submission

VALUE CHAIN ANALYSIS 2
Question: Value Chain Analysis is an important strategic activity when developing an online
learning program for responsive, competitive organizations. Explain Value Chain Analysis,
and address the four industry competitive forces that need to be identified and understood
when conducting Value Chain Analysis. Conceptualize the methodology that you would use
when conducting a Value Chain Analysis for an online learning program of your choosing
(real or imagined).
Introduction
Value Chain is the sorting of activities that are being performed by an organization or
corporation to create value for its clients. Value chain creates added value for the
organization, which in turn helps in which leads to the attainment of competitive advantage in
the market. Besides that, value chain analysis can be applied and used in an online learning
program. This paper represents a detailed discussion on value chain analysis of online
learning. The paper addresses the factors which is significant while conducting value chain
analysis of any program which includes competitive rivalry, bargaining power of buyers,
bargaining powers of suppliers, the threat of substitute products, threats of new entrants. The
analysis further evaluates the most appropriate method to conduct a value chain analysis of
the online program.
Value Chain Analysis for Online Learning Program
Value Chain can be well defined as the assortment of activities that are being
performed by an organization or corporation to create value for its clients (El-Sayed, Dickson
& El-Naggar, 2015). It creates added value to the organization, which in turn helps in which
leads to the attainment of competitive advantage in the market. According to Samsatli,
Samsatli, and Shah, (2015) eventually, value chain analysis of any particular organization
creates added value, and the same added value helps in improving the overall organizational
structure and operations, thereby generating higher profits. According to Lawton, Rosenau,

VALUE CHAIN ANALYSIS 3
and Verdun (2018), the Value Chain Analysis has been structured by Michael Porter which
emphases on the systems as well as on the activities with customers as the dominant principle
instead of focusing on the departments or accounting expense sets. In addition to this, the
system connects both the systems and the activities with each other, thereby demonstrating
the effect of one source on the other. Subsequently, according to Sindi and Roe (2017), by
using the VCA, it becomes clear and easy to identify the sources of profit and loss for an
organization.
Merriam and Tisdell (2015) are of the viewpoint that, running any business requires
immense skills, techniques, and strategies to be implemented at the right time to reach the
desired goal. Moreover, according to the study and analysis carried out by Nicholas and
Steyn (2017), Michael Porter has emphasized on the five major competitive forces which
must be recognized and comprehended while conducting Value Chain Analysis. The forces
are the competitive rivalry in the market, the bargaining power of buyers and bargaining
powers of suppliers, threat of substitute products and services and threats of new entrants in
the market.
Competitive Rivalry- Low
According to the review and analysis that was done by Yunna and Yisheng (2014), it
is evident that one of the most significant challenges which are faced by any organization is
competition from the rival companies. It not only causes more pressure on the management
of the organization but also encourages them to strategize their business operation and plan
for the future prospects. For the competitive organization, it is essential to conduct complete
research on the existing market competition as well as the potentials of the new entrants as
well.
Bargaining Power of Buyers- Moderate

VALUE CHAIN ANALYSIS 4
Bargaining power of buyers can be determined by identifying how quickly the buyer
drives down the price of the product or services. This will depend on the number of buyers,
their order cycle, number of orders, and switching cost to the products of rival companies.
Yunna and Yisheng (2014), in their work, emphasized that when dealing with merely a few
savvy clients, they have more power, and vice versa. This factor entirely deals with the
capability of the customers to reduce the price of the products and services. Smaller the
customer base, the less power they have, and vice versa.
Bargaining Powers of Suppliers- Low
Bargaining power of the suppliers is determined by identifying their power to increase
the price of the products and services. In addition to this, the supplier’s power is also
determined by the number of potential suppliers in the market, their uniqueness of the
products and services and the switching cost to change the supplier to another (Yunna &
Yisheng, 2014). The more the number of suppliers, the easier it becomes to switch to another
alternative supplier providing products and services at the lower price, and vice versa. For
online learning program, this force will help in addressing how easily suppliers can drive up
the cost of providing distance education. The online learning program will be affected by a
few numbers of suppliers in the market and their market reputation, the price of service and
such.
The threat of Substitute Products- High
According to the point of view of Porter and Heppelmann (2014) where there exists
close substitute products and services being provided by a company, it increases the chances
of the customers to switch from one alternative to the other subject to the increase or decrease
in the price and the quality. As a result of this, there is a reduction in both the power of
suppliers as well as the market appeal. Therefore, it can be said that the competitive
substitutes that can pose a significant threat to the products and services of any company. If

VALUE CHAIN ANALYSIS 5
clients depend on any company to provide service which can be replaced with another
service, and that too at lower accost and similar quality, it can weaken the power of the
company. Thus, in the present case, the power of other companies or organizations to provide
similar distance learning services at low cost would pose the immense threat, both on
productivity as well as on the profits.
Threats of New Entrants- Moderate
The more profitable the market would attract new companies. This, in turn, erodes the
productivity and the profitability of the existing companies. Except when there are strong,
and tough barriers to entry, which is imposed by legal regulations such as economies of scale,
or patents, copyright and trademark requirements, the profitability might decline to a
competitive rate when there is the huge number of newcomers in the industry. In the present
case, the online learning program will also be affected by the new entrant's force into the
market. Therefore, it is essential to gather complete knowledge about the laws, legal
requirements and how easy is it to conduct this business.
Methodology to conduct Value Chain Analysis (VCA)
Lund-Thomsen and Lindgreen (2014), contends that it is essential to identify the
methodology which will be used by the researcher to analyze the value chain of any
organization. The method to be adopted for value chain analysis depends on the scale, scope,
as well as the objective of the study. The scholars suggest that the quantitative method is the
most appropriate method for VCA for the reason that it enables the researcher to quantify the
results for better evaluation. On the other hand, Turker and Altuntas (2014) contend that
qualitative methodology suffices the requirements of the evaluation process of the value
chain.
For online learning program, it would be appropriate to use qualitative methodology
to conduct VCA. The key elements will include mapping the supply chain, identifying the

VALUE CHAIN ANALYSIS 6
governance structure within the chain, exploring areas to upgrade within the chain, assessing
the benefits in chain participation, assessing present market demand of online education and
future potential, infrastructure, management, development of technologies, procurement of
supplies, inbound logistics, outbound logistics, market and sales, and services. The qualitative
method would help in assessing as well as providing valuable data such as data concerning
user needs, students behavior patterns, along with the use in the designing the infrastructure
of the online learning program.
Conclusion
Online learning program can be affected by the value chain analysis if the right
methods are used and put in place. It is important for the system to identify the key structures
that govern the structure inside the chain so that it can assess and evaluate the market. From
the above analysis, it can be concluded that the market forces are low in terms of competitive
rivalry, and power of suppliers, whereas the power of the buyers and threats of new entrants
seems to be moderate and the threats from substitute seems to be high. The most common
method which can be used to conduct value chain analysis is a qualitative method.

VALUE CHAIN ANALYSIS 7
References
El-Sayed, A.F.M., Dickson, M.W. & El-Naggar, G.O. (2015). Value chain analysis of the
aquaculture feed sector in Egypt. Aquaculture, 437, pp.92-101.
Lawton, T.C., Rosenau, J.N. & Verdun, A.C. (2018). Introduction: Looking beyond the
confines. In Strange Power: Shaping the parameters of international relations and
international political economy. Abingdon: Routledge.
Lund-Thomsen, P. and Lindgreen, A. (2014). Corporate social responsibility in global value
chains: Where are we now and where are we going?. Journal of Business
Ethics, 123(1), pp.11-22.
Merriam, S.B. & Tisdell, E.J. (2015). Qualitative research: A guide to design and
implementation. New Jersey: John Wiley & Sons.
Nicholas, J.M. & Steyn, H. (2017). Project management for engineering, business, and
technology. Abingdon: Routledge
Porter, M.E. & Heppelmann, J.E. (2014). How smart, connected products are transforming
competition. Harvard Business Review, 92(11), pp.64-88.
Samsatli, S., Samsatli, N. J., & Shah, N. (2015). BVCM: a comprehensive and flexible toolkit
for whole system biomass value chain analysis and optimisation–mathematical
formulation. Applied Energy, 147, 131-160.
Sindi, S., & Roe, M. (2017). The Evolution of Supply Chains and Logistics. In Strategic
Supply Chain Management (pp. 7-25). Palgrave Macmillan, Cham.
Yunna, W., & Yisheng, Y. (2014). The competition situation analysis of shale gas industry in
China: Applying Porter’s five forces and scenario model. Renewable and Sustainable
Energy Reviews, 40, 798-805.