The value chain framework can be used as powerful analysis tool for the strategic planning and to build the organizational model ensuring an effective leadership model. The value chain concept can be applied also in the individual business unit and can be extended to the whole supply chains and distribution networks. To form a successful product for an organization it is important to add value in each activity that the product goes through during the life cycle. The best possible value can be achieved in the product development process by adding value in each stage. For that it needs all, or a combination of, value chain activities and a proper synchronization among all the related activities. A proper organization is required that contains all the required functional departments to perform these activities and a proper communication approach is required to synchronize the activities of these functional units efficiently.
Primary activities can be classified into product related and market related activities which are described below:
The Technology Management activities can be presented as research and development (R&D) function which increases the stock of knowledge for the organization.
1. Production (P): This is the process to produce a good or service from the inputs collected from the supplier using the resources that carry a cost determined by production factors.