In 1985, Michael Porter published Competitive Advantage: Creating and Sustaining Superior Performance. In this book, he described how organizations can achieve competitive advantage in their industries. Porter's focus in this book was not on an overall competitive strategy, but on what organizations needed to do on a daily basis to achieve results. As Porter (3) stated, "My aim is to build a bridge between strategy and implementation." To create the link between the overall strategy of a firm and how that strategy could be achieved, Porter referred to value. As Porter (3) stated, "competitive advantage grows fundamentally out of value a firm is able to create for its buyers that exceeds the firm's cost of creating it." This focus on value led to the concept of the value chain, which refers to the internal processes that occur as the organization creates its product or service. .

             Value chain management is not just a process that occurs within an organization. Instead, it is closely linked to the competitive environment. This means that value chain management takes into account the industry in which the organization operates. This is referred to as the industry value chain and describes how the industry overall adds value to the consumer. This is an important point because it means that value chain management does not just refer to the series of processes that occur within the organization. As an example, consider the case of Apple's Ipod. If creating value was only considered in the context of what happens within the organization, the focus might be purely on the manufacturing process. Apple might consider their value chain as a process where raw materials are converted to the product and where the product is distributed to the consumer. In terms of improving the value of their product, they might consider that saving on raw materials, decreasing production time, and improving distribution will help add value.