Value chain analysis

• Value chain analysis in strategic management is used to evaluate a company’s value chain elements

• Proposed by Michael Porter

• A process where a firm identifies its activities that add value to its final product

• It is a tool for identifying ways to create more customer value and analyze internal firm activities

• Value chains help increase a business's efficiency so the business can deliver the most value for the least
possible cost.
 Strategic Audit
• A strategic audit is an examination and evaluation of areas affected by the operation of a strategic

management process within the organization

• It provides an platform for discussion with the top management regarding necessary corporate action or

changes in business plan

• The organization can improve business performance by conducting such audit

• The core of strategy audit lies on four important question

I) How well is the current strategy working?

II) How well will the current strategy working in future?

III) How can this be evaluated in present and future?

IV) How urgent is there a need to change in strategy?

• Consistency: states that a strategy must not have conflicting goals and objectives. Conflict within the organization reflects a
problem in management but can also refer to strategic inconsistency.

• Consonance: emphasizes the importance of examining sets of trends. A strategy symbolizes an adjustment to an external
stimulus or changes in the environment.

• Feasibility: can strategy be attempted within the physical, human and financial resources?

• Advantage: strategy must provide the competitive advantage. Competitive advantage normally are the result of superiority in
one of three areas- resource, skills or position.