Editing Value chain (section)

==Significance==
The value chain framework quickly made its way to the forefront of management thought as a powerful analysis tool for [[strategic planning]]. The simpler concept of [[value stream mapping]], a cross-functional process which was developed over the next decade,<ref>{{cite book
 | last = Martin
 | first = James
 | title = The Great Transition: Using the Seven Disciplines of Enterprise Engineering
 | place = New York
 | publisher = [[AMACOM]]
 | year = 1995
 | isbn = 978-0-8144-0315-0
 | url-access = registration
 | url = https://archive.org/details/greattransitionu00mart
 }}, particularly the Con Edison example.</ref> had some success in the early 1990s.<ref>{{cite news
 | title = The Horizontal Corporation
 | work = [[Business Week]]
 | date = 1993-12-20
 }}</ref>

The value-chain concept has been extended beyond individual firms. It can apply to whole [[supply chain]]s and [[distribution (business)|distribution]] networks. The delivery of a mix of [[product (business)|products]] (goods and [[Customer service|services)]] to the end customer will mobilize different economic factors, each managing its own value chain. The industry wide synchronized interactions of those local value chains create an extended value chain, sometimes global in extent. Porter terms this larger interconnected system of value chains the "value system". A value system includes the value chains of a firm's supplier (and their suppliers all the way back), the firm itself, the firm distribution channels, and the firm's buyers (and presumably extended to the buyers of their products, and so on).<ref>{{Cite web|url=https://papers.ssrn.com/sol3/papers.cfm?abstract_id=4818195|title=Dynamic Value Networks Theory (DVN): Harnessing Interconnected Relationships for Value Creation|date=8 May 2024|access-date=3 April 2025|publisher=SSRN|last=Pirro|first=Nicholas}}</ref>

Capturing the value generated along the chain is the new approach taken by many management strategists. For example, a manufacturer might require its parts suppliers to be located nearby its assembly plant to minimize the cost of transportation. By exploiting the upstream and [[downstream (manufacturing)|downstream]] information flowing along the value chain, the firms may try to bypass the intermediaries creating new [[business model]]s, or in other ways create improvements in its value system.