The value chain for any firm links value-creating processes and activities. It refers to the entire performance process of a company, which begins with the research and development and ends with the delivery to the end consumer. While a function and risk analysis is geared to individual group companies, a value chain analysis applies on cross-company processes within the Group.
Companies always have and will continue to view the world and their competitive environment in a unique manner, have their own mission, vision, ambition and corporate objectives and define their own unique competitive advantages.
Due to this, there is no objective method to conduct a value chain analysis. Hence, the basic approach to be followed for any value chain analysis should start with identifying the industry-wide value chain and mapping the value linkages of the MNE within the industry. A value contribution analysis should contain evidence as to what prices, cost premiums, margins, etc. are, in light of the economic contributions the individual companies, considered reasonable.
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