HC-5forces
The Health Club Industry
This case provides an opportunity to practice analyzing the industry environment and how it might influence the strategic issues facing a firm. In essence, any industry analysis requires us to think about how broadly we should define the scope of the industry. Please be sure to identify the boundary of the industry.
In preparing your case for class discussion, please ensure you have read chapter two from Dess Lumpkin and Eisner, 2012, which is available on Blackboard. Further detail is available in Porter, M.E. (2008). The five competitive forces that shape strategy. Harvard Business Review, 86 (1), 78-93, which can be found via the library catalogue.
Please focus your notes on trying to apply each of the five forces mentioned in this article to the case study. Look at what contributes to each of the five forces and try to identify or interpret data and evidence from the case to make a judgment about each of these. Avoid merely describing the case by ensuring you use the model as a framework for analysis; then for each component of the model, evaluate whether that ‘force’ would present difficulty for a firm competing in the industry. Finally, you should consider what the framework as a whole tells us about the industry and implications for firms. You may use the worksheet below to help you structure your notes if you wish.
Please note: in real life, as in the case, we often don’t have full information so have to make ‘best assessments’ based on the data we have. If you find there are no data to address a factor, leave it blank.
Use the Five Forces framework to assess the relative strength in each of the areas (please re-size document as you wish). NOTE – if you cannot find or infer information in the case to address a factor, leave it blank
Threat of New Entrants
Evidence from case
Implications for this ‘threat’… does it lead to high/low barriers to entry
Economies of scale
23,000 health clubs in US (2004)
YMCA with 2,500
This case provides an opportunity to practice analyzing the industry environment and how it might influence the strategic issues facing a firm. In essence, any industry analysis requires us to think about how broadly we should define the scope of the industry. Please be sure to identify the boundary of the industry.
In preparing your case for class discussion, please ensure you have read chapter two from Dess Lumpkin and Eisner, 2012, which is available on Blackboard. Further detail is available in Porter, M.E. (2008). The five competitive forces that shape strategy. Harvard Business Review, 86 (1), 78-93, which can be found via the library catalogue.
Please focus your notes on trying to apply each of the five forces mentioned in this article to the case study. Look at what contributes to each of the five forces and try to identify or interpret data and evidence from the case to make a judgment about each of these. Avoid merely describing the case by ensuring you use the model as a framework for analysis; then for each component of the model, evaluate whether that ‘force’ would present difficulty for a firm competing in the industry. Finally, you should consider what the framework as a whole tells us about the industry and implications for firms. You may use the worksheet below to help you structure your notes if you wish.
Please note: in real life, as in the case, we often don’t have full information so have to make ‘best assessments’ based on the data we have. If you find there are no data to address a factor, leave it blank.
Use the Five Forces framework to assess the relative strength in each of the areas (please re-size document as you wish). NOTE – if you cannot find or infer information in the case to address a factor, leave it blank
Threat of New Entrants
Evidence from case
Implications for this ‘threat’… does it lead to high/low barriers to entry
Economies of scale
23,000 health clubs in US (2004)
YMCA with 2,500