BUSINESS

No other industry can not survive without on the stability of the vital links with other similar industries. The market prospects and its industries make these connections. Take the example of the aviation industry. According to Kenneth D. Pritsker SAM Advanced Management Journal:

“With a model based on competing firms in key sectors of the aviation industry, identify key relationships between industry segments in a manner that balances the perspectives of professionals and foreigners. The model covers the process of the business value chain, and interactions that produce finished products in order to isolate the issues of strategic processes and coping skills. ”

“Over the past 20 years in the industry, expanding its borders by diversifying into new products
Creative sectors in the sub-contracting and outsourcing, and the signing of cooperation agreements with companies in other innovative sectors. This expansion has virtually erased the traditional boundaries of the sector through the creation of an economy, sectors that are closely linked. ”

Basics

In addition to the diversification of manufacturing industries in the various markets in which they live, virgin, the interaction between the industry is considered essential for survival. Process and the so-called value chains are also part of the general framework has been the location of industry and technology on the market.

The purpose of this approach is that companies can not compete in the same way as they nineties after years. In times of crisis, is the only way for engineering companies and industries that rely on the will to survive if they focus on integrated value chain.

Industry Analysis defined

After Pritsker:

“Industry analysis focuses mostly on the external dimension of the company and its markets, customers and competitors. Research on the structure of the industry has examined the impact of the economic structure of competition, the advantages of control of strategic industries and the factors that determine the profitability of the industry (Huff, 1982). Another area of research has shown how external changes such as changes in customer needs, new technologies, public policy studies, globalization and economic cycles, based on the strategy of a firm (Hambrick, 1983 ). led the scope of the external changes in the last 20 years, the strategic planners to develop tools for the analysis of external use of this information to assist in the development of active strategies. Consequently, strategies tend to the importance for understanding the structure of domestic to minimize industry.

You can see Pritsker mentioned the importance of controlling industry. Industrial control relates to the management and complete control over all areas of production and the flow rate of receipt of services and assets. The control of the industry is fertile and largely untapped industry evaluation, which requires maximizing a disciplined approach to their profits.

The understanding of the value chain

The next step in the evaluation of the industry is determining the actual dynamics of the specific value chains. The horizontal value chains create value. For example, you have the elements of the fuselage of the aircraft, etc.. Another type of value chain is the vertical value chain. After Pritsker:

“The value chain of the second is vertical, horizontal, coordinated between the channels. An example of a vertical chain would apparatus and design activities with the components of the aircraft wings and tail are associated design matched to certain flight characteristics in an aircraft to produce. “