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5.7.3 Support activities
Support activities are those which support primary activities
and each other. Three of these – procurement, technology
development and human resource management – can be
associated with specific primary activities while the fourth,
business infrastructure, supports the entire chain. Support
activities comprise:
� Procurement – while raw materials procurement is usually
concentrated in a purchasing department, other purchasing is
often dispersed throughout a firm.
� Technology development – includes engineering and process
development and, while usually associated with an engineering
or development function, may also be dispersed (office
automation, telecommunications, etc.).
� Human resource management – recruitment, hiring, training,
development and compensation of all personnel. Partly
centralized but increasingly dispersed, Porter points out that
the skills and motivation of employees and the costs involved
may be critical to competitive advantage.
� Firm infrastructure – broadly encompasses general management
activities, as well as finance, accounting, legal, corporate
affairs and quality management. Often viewed as an overhead,
these can be a considerable source of advantage (e.g.
skilful negotiations with regulatory bodies).
5.7.4 Defining a value chain
Starting with the generic value chain, individual value activities
are identified for the particular firm within its particular
industry. Each of the main categories in the overall model can be
subdivided into separate activities. In this way, sales and
marketing might be subdivided into marketing management,
advertising, sales force administration, salesforce operations,
technical literature, promotion, etc. This process of subdivision
can continue down to increasingly narrow activities provided
that they are bounded from each other.
Determining which activity lies within which category requires
judgement. In particular it depends on the nature of the firm, its
industry and where it derives the competitive edge which keeps
it in business. Thus, we can regard order processing within
outbound logistics or, if it is an important element of the way a
firm interacts with its buyers, it could be defined within
marketing. One way or another, however, everything a firm
does should be captured and identified.