Any company that possesses an efficient value chain most likely has a great competitive advantage. It is crucial for a company to know and understand its value chain in order to stay ahead of the competition and thrive in a competitive market. Understanding a company’s value chain can also be cost effective. This essay will go into specifics as to why the value chain is vital in creating competitive advantage. It will also compare companies that possess efficient value chains and a successful competitive advantage with those that do not. A successful value chain can bring great success to a companyby enhancing customer satisfaction which can develop into a major competitive advantage.