The Role of Value Chain Model

2 From value chains to value networks and inter firm relationship
2.1 The evolution of the concepts of value chain
Porter´s value chain model shaped our way of understanding and analyzing industries for the past 30 years. It explores the links between the activities to be undertaken in order to commercialize a product in the market and how these activities add value to the final delivery (Peppard and Rylander, 2006). It focus on the value creation processes within the firms, not on the inter firms links in the value chain (Kothandaraman and Wilson, 2001) and how the different links influence the competitiveness of the industries (Peppard and Rylander, 2006).
Therefore, this model assumes that the value is created within one single main firm with a clear hierarchy, or expanded through the interaction of this main firm with other firms with a defining coordination. This main firm performs or coordinates the activities throughout the productive process - from raw materials to the final product. The main firm suppliers are included in the model, as they also perform tasks needed in the production process. Nevertheless, the buyer-supplier interactions are analyzed and performed taking into account market relations mainly based in price and therefore, follow a more competitive than collaborative model (Kothandaraman and Wilson, 2001).
The value creation in this model is considered linear, which means that every firm has a clear position in the value chain and provides the inputs for the next part of the production process, until reaching the customer in the market. The value is added in every new part of the process and measured in each output delivered to the next buyer in the chain.
The buyer´s choice of suppliers is based predomin...

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