Every organization benefits from a number of resources and inputs; these undergo
processing and are transformed into customer offerings. One of the most commonly used
tools for examining the available resources of organizations is the value-chain analysis. A
value chain represents an organization as a chain of activities that add value to its products
and services. This is within a broader supply chain that includes all suppliers and
distributors and requires supply chain management.
As a consequence the organization generates a margin of value (profit margin) as a
benefit.
Figure 2.1 represents the value0chain concept diagrammatically. Although the valuechain
model is mainly associated with manufacturing products, service and in particular
tourism and hospitality organizations can draw useful conclusions provided that they
appreciate the differences in their processes. Operations and production in a restaurant, for
example, may start only once the customer has arrived and, therefore, the chain needs to
be adjusted within the tourism and hospitality context