3.Using an extended example critically discuss the view that a sector Essay - 2

3.Using an extended example critically discuss the view that a sector matrix gives a better strategic understanding of product markets than the concepts of product or commodity chains - Essay Example the incorporation of both value chain analysis and commodity chain analysis, sector matrix analysis stands out as the most effective tool for businesses to generate better strategic understanding of product markets (Froud, Johal, Leaver and Williams, 2006). The sector matrix offer information about complex product markets unlike commodity chain analysis that is based on a linear analysis. This study will first expose the inherent weaknesses in the commodity chain analysis that makes the model ineffective in the modern product markets before embarking on suitability of sector matrix as the preferred tool that should be used to determine business policies. A commodity chain for any given product covers the necessary processes that take place to ensure at the end of the undertaken activities is a finished product. Since the development of commodity chain analysis, researchers have identified number of issues that limits the ability of the concept to provide an up to date analysis of product market situations (Kutting, 2004). This criticism has not only been from scholars outside the commodity chain perspective, but also from within. For instance, the different perspectives by scholars who use the commodity chains concept has resulted in the presence of two schools of thought where there are those in favour of the traditional world systems approach who are attributed with the introduction of commodity chain concept. The other school of thought that includes scholars such as Gary Gereffi and colleagues are in favour of a more encompassing tool for analysis and are therefore credited with the introduction of the global commodity chain (Ba ir, 2005). For instance, the transformation brought by globalization can be experienced when in the clothing industry the raw material is harvested in India but manufactured into yarn in Portugal. The yarn is then transported to Taiwan for colouring then to Poland where it is weaved. The other parts like buttons and rivets are