What is a key difference between internal value chains and external value chains?

The key difference between internal and external value chains lies in their scope and focus concerning operations and interactions with customers. Internal value chains pertain to the activities and processes that occur within an organization, primarily aimed at the production of goods and services. This includes aspects like procurement, operations, and logistics, which are critical for efficiently converting inputs into finished products.

On the other hand, external value chains extend beyond the organization to include interactions with customers and other external entities. These chains are concerned with relationships and activities that enhance customer satisfaction and delivery of value to the end-user, such as marketing, sales, and distribution networks.

The distinction emphasizes that while internal value chains are critical for operational efficiency, external value chains are essential for ensuring that the produced goods and services meet customer needs and expectations. Understanding this differentiation enables pharmacists and pharmacy managers to strategically manage both internal operations and customer relations to optimize overall service delivery in a community pharmacy setting.