Understanding the Dynamics of the Value Chain

The Void in Porter’s Value Chain Model

Michael Porter’s value chain model was presented in Chapter 1. It included the support activity of human resource management. ­Unfortunately, his discussion related to that activity is silent on the issue of reward sharing as is the existing literature on the value chain. Here is where the human resource management component of Porter’s value chain model needs to play a prominent role. Its role, however, will be dictated by the organization’s leadership and the kind of culture that the leadership will ultimately create. As we saw in Chapter 1, Porter’s model is silent on the leadership and culture dimensions that are necessary conditions if a firm seeks to change its compensation structure to promote ...