Use an Example to Critically Examine Whether the ‘Sector Matrix' Framework Is Useful for Analyzing Demand and Supply Linkages in All Industries.
The business model and environment is changing with the times. The scholars like Michael Porter and Gereffi have tried to use their theories - The Chain Concept, to explain the concept and connection between the supply side and the demand side of the market. Therefore, in order to examine every industry can be well analyzed by using ‘Sector Matrix' concept; we have to understand the Chain concept as well. So in the following paragraphs, I'm going to explain the structure of ‘Chain concept' and ‘Sector Matrix', comparing their difference, and the idea of how ‘Sector Matrix' approached to help understanding the production and consumption side in each industry, with applied the motoring industry as an critical example.
‘The chain concept' is combined with the ‘Value Chain' of Porter, and the ‘Global commodity chain' of Gary Gereffi. The ‘Value Chain' means the products have been added-value after passing through the chain activities. It is more likely the daily production activities of the traditional production and manufacturing firms. In 1985, Porter stated out this concept because he believed that through the successful generic strategy in the production chain of the firm's business unit activities, can help the firms to achieve the competitive advantages. You can simply think about the input passing through each production steps like design, packaging, delivery products, etc. And finally the value of the end products will be increased. It's like a linear linked chain flowing from input to output, that we can say it is a supply perspective as it started from supply side to the finished product. For example, a piece of log didn't have a valuable price at first. But after being designed how to cut into pieces, and planned to make as furniture, with some colorful colors painted on it, and even the product has been advertised on TV or magazines. The price of ‘the log' finally will rise up more than several times as its original cost. We can see this is the primary
‘The chain concept' is combined with the ‘Value Chain' of Porter, and the ‘Global commodity chain' of Gary Gereffi. The ‘Value Chain' means the products have been added-value after passing through the chain activities. It is more likely the daily production activities of the traditional production and manufacturing firms. In 1985, Porter stated out this concept because he believed that through the successful generic strategy in the production chain of the firm's business unit activities, can help the firms to achieve the competitive advantages. You can simply think about the input passing through each production steps like design, packaging, delivery products, etc. And finally the value of the end products will be increased. It's like a linear linked chain flowing from input to output, that we can say it is a supply perspective as it started from supply side to the finished product. For example, a piece of log didn't have a valuable price at first. But after being designed how to cut into pieces, and planned to make as furniture, with some colorful colors painted on it, and even the product has been advertised on TV or magazines. The price of ‘the log' finally will rise up more than several times as its original cost. We can see this is the primary