Association of Chartered Certified Accountants (ACCA) Certification Practice Test

Which of the following is considered a primary activity in the value chain?

1. HR management

2. Procurement

3. Operations

4. Technological Development

The correct answer is: Operations

In the context of the value chain, operations represent a crucial primary activity because they directly relate to the transformation of inputs into outputs, leading to the creation of products or services. This function encompasses all activities involved in the production process, including manufacturing, packaging, assembly, and testing. Primary activities are essential as they contribute directly to the creation of value and revenue for a company. In contrast, the other options such as human resource management, procurement, and technological development are considered support activities. While these support activities play vital roles in enhancing efficiency and effectiveness, they do not involve the direct processes of producing and delivering the final product to customers. By understanding the distinct roles within the value chain, one can better appreciate how a company creates competitive advantage through its operations and other primary functions.