Distinctive Value Chain

Most managers think about strategy in terms of which customers’ needs they are meeting. It’s less intuitive to think about distinctive ways to satisfy those needs.

A unique value proposition will not translate into a meaningful strategy unless the best set of activities to deliver it is different from the activities performed by rivals. If that were not the case, every competitor could meet those same needs, and there would be nothing unique or valuable about the positioning.

Insight into customers’ needs is important, but it’s not enough. The essence of strategy and competitive advantage lies in the activities, in choosing to perform activities differently or to perform different activities from those of rivals. Successful companies like IKEA have done just that, tailoring their value chains to their value propositions.
More about the Value Chain