Michael Porter’s five forces model
Table of Contents
Assignment Question
ASSIGNMENT 1
1. Michael Porter’s five forces model is a popular framework used for analysing the competitive structure of an industry.
With reference to an industry you are familiar with, discuss the application of this model in the analysis of the given industry.
2. The success of the Mauritian tourism sector has been attributed to a large extent to the possession of core competences by the tourist operators.
(i) Explain the term core competences, in relation to the tourism sector.
(ii)Discuss how far you agree with the above statement, justifying your answer.
3. The operations manager of Textile industries Ltd received an unexpected order, which led to a sudden surge in demand. This demand could not be met with the present capacity.
Discuss the various options available to the operations manager in order to meet this sudden increase in demand.
Q1. Michael Porter’s five forces model is a popular framework used for analyzing the competitive structure of an industry. With reference to an industry you are familiar with, discuss the application of this model in the analysis of the given industry.
Porter’s Five Forces
Michael Porter has identified five forces that determine the basic long-run attractiveness of a market or market segment: (Kotler 2009)
These forces are:
(1) the risk of entry by potential competitors;
(2) the bargaining power of buyers;
(3) the bargaining power of suppliers;
(4) the threat of substitutes; and
(5) the resulting intensity of rivalry among existing competitors (Porter, 1980).
1. Threat of intense segment rivalry
A sector is unattractive if it already contains several, tough or aggressive competitors. But however this may lead to price war, advertising battles and innovated product launch and thus this will be very expensive for new small entrance to keep going on a long run. Based on the telecommunication industry in
Assignment Question
ASSIGNMENT 1
1. Michael Porter’s five forces model is a popular framework used for analysing the competitive structure of an industry.
With reference to an industry you are familiar with, discuss the application of this model in the analysis of the given industry.
2. The success of the Mauritian tourism sector has been attributed to a large extent to the possession of core competences by the tourist operators.
(i) Explain the term core competences, in relation to the tourism sector.
(ii)Discuss how far you agree with the above statement, justifying your answer.
3. The operations manager of Textile industries Ltd received an unexpected order, which led to a sudden surge in demand. This demand could not be met with the present capacity.
Discuss the various options available to the operations manager in order to meet this sudden increase in demand.
Q1. Michael Porter’s five forces model is a popular framework used for analyzing the competitive structure of an industry. With reference to an industry you are familiar with, discuss the application of this model in the analysis of the given industry.
Porter’s Five Forces
Michael Porter has identified five forces that determine the basic long-run attractiveness of a market or market segment: (Kotler 2009)
These forces are:
(1) the risk of entry by potential competitors;
(2) the bargaining power of buyers;
(3) the bargaining power of suppliers;
(4) the threat of substitutes; and
(5) the resulting intensity of rivalry among existing competitors (Porter, 1980).
1. Threat of intense segment rivalry
A sector is unattractive if it already contains several, tough or aggressive competitors. But however this may lead to price war, advertising battles and innovated product launch and thus this will be very expensive for new small entrance to keep going on a long run. Based on the telecommunication industry in
References: Brannback, M., & Jelassi, T. (1999). Knowledge-based strategic market management: Journal of Decision Systems, 8(Special Issue), 195–213. Bogner, W. C., & Thomas, H. (1994). Core competence and competitive advantage: A model and illustrative evidence from the pharmaceutical industry. In: G. Hamel & A. Heene (Eds), Competence Based Competition Govt.mu core competency Available From: [http://www.gov.mu/portal/goc/tourist/file/charter.pdf] [Accessed 26/10/2010] Kotler P and Keller K.L (2009) Marketing Management 13th Edition, London: Pearson Education Porter, M. E. (1980). Competitive strategy. Techniques for analyzing industries and competitors. Rothaermel, F. T., & Hill, C. W. L. (2005). Technological discontinuities and complementary assets: A longitudinal study of industry and firm performance. Organization Science, 16(1), 52–70.