Business Functions and Processes Essay Example | Topics and Well Written Essays - 5000 words

Business Functions and Processes - Essay Example Primary activities are mainly associated with the creation of a particular product, whereas support activities involve assignments that support the primary activities and each other. Three of the support activities that include procurement, human resource management and technology development can be connected to primary activities, while the fourth activity (firm infrastructure) is responsible for supporting the entire value chain. The concept of value chain postulated by Porter (1985) explains that attaining competitive advantage begins with the effort to build organizational proficiency in conducting specific competitive value chain activities. The underlying aim behind performing such activity is to attempt harnessing those capabilities, which strengthen competitiveness and strategy of an organization. Given the fact that one or more of these abilities become the cornerstone of a company’s strategy and more resources are then allocated towards building greater expertise in performing these activities, the targeted abilities may ultimately become sustainable core competencies (Roper, Du and Love, 2008). In order to understand significance that Porter had attached to the value chain, it is imperative to recognize that there are two distinct and basic sources of competitive advantage. One source is a lower relative cost advantage and the other is a sort of differentiation. Although empirical research scholars have argued on the fact that many companies (specially Japanese) have been largely successful in combining the two sources mentioned above into one source, Porter continued to seek ways whereby both the sources could be developed separately (Hansen and Birkinshaw, 2007). Porter’s primary emphasis was on the argument that attaining low cost advantage or differentiation largely relies upon the disconnected activities performed by an organization. By disaggregating these activities in strategically pertinent groups, managers will be