Week 3 Blog Post for Ent 610

In Magretta’s book, “Understanding Michael Porter,”  she continues to describes the connection between “Value Proposition” and “Value Chain.”   The Value Chain are the decisions a business decides to make in order to deliver the value proposition.  When deciding on strategy, one must begin by asking the question, “why do my customers buy from me?” By answering this question, the business owner can understand their current value proposition and whether they want to remain there.  We need a specific answer to this question. It cannot be a simple answer like “my customer service is my value proposition.” If changes are to be made, then we must look at the value chain and analyze which activities require adjustment.  

I am currently in the middle of the chapter on “Trade Offs.”  Trade offs are decisions made NOT to do something. There are always activities that could potentially take away value from the customer.  A simple example is a restaurant that serves multiple types of meals from different cultures. They cannot be great at serving everything if they decide to cuisine from multiple cultures.  There is a trade off in the decision to not serve all types of meals.

In the next two situation projects, I will analyze Porter’s Five Forces and the Value Chain of my hypothetical business.  I am looking forward to diving into these topics and creating a better understanding of what decisions could potentially add value to the business.  The Five Forces Analysis and Value Chain analysis will assist in creating a marketing calendar. Important activities will be identified which lead to value.  Please look for them in the upcoming weeks!

Magretta, J., (2012), Understanding Michael Porter, Harvard Business Review Press, Boston, MA, ISBN 978-1-4221-6059-6