Value chain is a conceptual framework that link customer needs , performance characteristics and attributes of a product or service with the activities, resources and capabilities that enables such characteristics and attributes to be produced ,also it may help to develop and identifying potential valuable resources and capabilities control which may eventually to create a competitive advantage to the firm .different may have different position to enter in the industry ,company may choice the economical position to enter the market after the value chain analysis
. While outsourcing is an activities that purchase of a value-creating activity form an external supplier, the analysis of values chain help the firms to identify which part of the activities, recourse, capabilities are in limited or need to be developed to crate a competitive advantages , since unless the company are huge enough, an ordinary company may not have the capabilities to possess all the resources they needed form raw material, work in process and final products or the services provided. as outsourcing can be in serviced or produced .
For example the low cost cell phone producer XUMI(小米)which outsourced the manufacturing and produced to the Foxconn which one of the world largest 3C product OEM firm, in XUMI cases, the outsourcing of the manufacturing process give help to the company to improve their values adding capabilities and obtain competitive advantages as XUMI have the TOP market share gain in low cost cell phone market in China ,also Foxconn provide a leader class standard of manufacturing , outsourcing of this may give the XUMI a possible to keep the cost down as , if XUMI decided to use a manufacturing on its own the cost of manufacturing plant, employee, the skilled labor, machinery will be a huge production cost toward XUMI and XUMI may not be