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Key Takeaways Entrepreneurs should view a product or service as a composition of constituent parts that add value to one another in order to satisfy a defined set of requirements, not as a single entity.
I refer to this perspective as the art of the value chain. The entrepreneurial significance of this art lies in the fact that opportunities rarely exist in isolation — they’re embedded within compositions of value.
What distinguishes an entrepreneur isn’t the ability to spot a market opportunity — it’s understanding the nuance of the composition and the ability to determine where within that composition they can preserve harmony and add value to the surrounding parts.
For entrepreneurs, it is of utmost importance to understand the nuances of the value chain. The value chain is often discussed in business literature as a sequence of activities through which value is created and delivered. While useful, such descriptions frequently fail to capture a more important aspect: the composition of value itself.
I intentionally use the word composition. Any product, whether a good or a service, whether a solution to a recognized problem or a lever through which new demand is created in the market, should be viewed as a composition of constituent parts that add value to one another in order to satisfy a defined set of requirements.
This way of viewing products and services changes the entrepreneur’s perspective. Instead of seeing a finished product as a singular entity, one begins to see the interactions between the elements that make its existence possible. Technology, expertise, processes, infrastructure, distribution channels, customer experience and aftermarket support cease to be separate considerations. They become components of a larger composition.
The art of the value chain
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