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How do i use Michael Porter's value chain analysis for an airline company (not aircraft)?
December 19, 2008 1:14 AM   Subscribe

How do i use Michael Porter's value chain analysis for an airline company (not aircraft)?

Hi there, I am just wondering how do i associate the value chain analysis for an airline company? I am mainly focusing on the primary activities (inbound logistics, operations, outbound logistics, marketing & sales and service).

Thank you in advance.
posted by red_rika to Education (2 answers total) 4 users marked this as a favorite
 
Ok, assuming you've already been through Competitive Advantage, to get the indepth background you'll need, I'd suggest approaching the problem as After you've done the preliminary research above, you're going to need quantitative data so you can begin to understand the firm's cost structure, and how each functional component of the chain actually (hopefully!) adds value.

Do you have access to the firm? The data you'll need simply will not be available from annual reports, etc. You'll have to get access to information at a very low, and no doubt sensitive, level of granularity otherwise you can only approach this problem in the abstract.

Hope this helps!

Great question by the way, seems like folks forget about Porter's work on the Value Chain, focusing instead on Five Forces (which is also cool stuff, but the guy has contributed a lot ...)
posted by Mutant at 2:55 AM on December 19, 2008


One thing to also consider is that the "value chain" is, in some circles, giving way to the "value web" - where customers can use alternative pathways to get what they want.

Airlines are a good example of this effect where "travel" can be put into many categories, which are sometimes interchangeable. For example, there are airlines, trains, buses, boats, cars, to get people to desired locations. There are airlines reservations systems, travel agencies, online booking systems, to obtain travel. There are also alternatives to location based travel such as cruise ships where the travel is the location. One could go as far as looking at replacements for travel such as long-distance calls, video conferencing, and online chat.

These are also interconnected in sometimes non-intuitive ways and the success or failure of indirect services can impact the value of the main industry. All of these can have an effect on the value of of an organization and its ability to grow and take advantage of change. Understanding this inter-connectedness can make or break a strategy.
posted by qwip at 8:47 AM on December 19, 2008


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