Value Chain Analysis and Methodology

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Value Chain Analysis and Methodology
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The internal value chain of an online learning institution consists of all physically and technologically distinct activities within the institution that add value to the learner's experience. The key to analyzing the value chain is understanding the activities within the institution that create a competitive advantage, and then managing those activities better than other institutions in the industry. Porter (1985) suggested that the activities of a business can be grouped under two headings: primary activities, those that are directly involved with the physical creation and delivery of the product or service; and support activities, which feed both into primary activities and into each other. Support activities (e.g., human resource management, technology development) are not directly involved in production, but have the potential to increase effectiveness and efficiency. It is rare for an organization to undertake all primary and support activities. Value chain analysis is thus a means for examining internal processes and identifying which activities are best provided by others. Figure 3-4 presents a generic value chain adapted for an online learning institution. Support activities consist of

1. organizational infrastructure, which is concerned with a wide range of support systems and functions, such as finance, planning, quality control, and general senior management. 2. human resource management, dealing with those activities concerned with recruiting, developing, motivating, and rewarding the workforce of the organization. 3. technology development, dealing with those activities concerned with managing information processing and the development and protection of "knowledge" in the organization. 4. procurement, which deals with how resources are acquired for the organization (e.g., sourcing and negotiating with suppliers). The overall primary structure in an online distance education organization such as the...
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