CA Intermediate · Financial Management and Strategic Management · Strategic Analysis: Internal Environment
Sundaram Appliances studies its activities of inbound logistics, operations, outbound logistics, marketing and sales, and service to identify where it creates margin. Which framework is it applying?
The firm is applying value chain analysis to its primary activities. Inbound logistics, operations, outbound logistics, marketing and sales, and service are the five primary activities in Porter's value chain, which examines where margin is created. Support activities are different and include procurement and HRM.
- AValue chain analysis, primary activitiesCorrect
- BValue chain analysis, support activities
- CBCG matrix
- DAnsoff matrix
Explanation
Porter's value chain splits activities into primary (inbound logistics, operations, outbound logistics, marketing and sales, service) and support (procurement, technology development, HRM, firm infrastructure). The listed activities are all primary. BCG and Ansoff deal with portfolio and growth choices, not internal activities.
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