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1 – 10 of over 1000The purpose of this paper is to provide practitioners and students a practical yet comprehensive set of templates for applying Michael Porter's five forces framework for industry…
Abstract
Purpose
The purpose of this paper is to provide practitioners and students a practical yet comprehensive set of templates for applying Michael Porter's five forces framework for industry analysis.
Design/methodology/approach
Based on experiences with practicing managers, small business owners, industry analysts, academics, and students, a set of industry analysis templates that systematically guides an analyst through a comprehensive assessment of the five forces is presented with the following: copies of the templates themselves, descriptions of their structure and use, an example of a completed template (spectator sports industry), and a discussion of possible modifications and extensions.
Findings
The industry analysis templates described in this paper retain the comprehensiveness of Porter's framework but in a format much more student/manager-oriented using graphics, visual cues, a uniform structure, and straightforward descriptions of concepts. Template users show evidence of deeper strategic insights and have a sophisticated tool for future analysis.
Practical implications
Managers, analysts, students, and others wanting robust industry analysis are provided with a comprehensive, structured, and practical set of templates to use in assessing an industry using the five forces framework.
Originality/value
Leading strategic management texts and other sources provide no comprehensive, systematic, and robust format for conducting a five forces analysis of an industry. The set of industry analysis templates described in this paper provides a visually compelling, user-friendly format that can assist those analyzing industries gain important strategic insights not only into industry drivers, but also important competitive advantages for individual firms.
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Francis M. Mathooko and Martin Ogutu
The purpose of this paper is to establish the extent to which Porter’s five competitive forces (PFCF) framework, among other factors drive the choice of response strategies…
Abstract
Purpose
The purpose of this paper is to establish the extent to which Porter’s five competitive forces (PFCF) framework, among other factors drive the choice of response strategies adopted by public universities in Kenya.
Design/methodology/approach
The study design was descriptive and utilized a cross-sectional survey of all the public universities in Kenya by administering a structured questionnaire to the top management team. Additional primary data were collected through observations and interviews. Secondary data were also collected in order to corroborate the data collected from the primary sources.
Findings
PFCF framework influenced the choice of response strategies adopted by the public universities “to a great extent”, the most influence being the threat from new entrants. The influence of the choice of response strategies by PFCF framework was independent of the age and category of the universities. Pressure from stakeholders, changes in government policies and regulations, reforms in higher education, unethical response strategies by some universities and university location also influenced the choice of response strategies.
Research limitations/implications
The study collected data from the top management team only; however, other stakeholders could have given additional information not reported here. Further, the research only considered public universities and not all higher education institutions (HEIs) in Kenya, and was cross-sectional, hence generalization and application of the results over a long time, respectively, may be limited.
Practical implications
The value of this study lies in HEIs achieving a competitive advantage and shaping strategic policy direction in the face of changing environment and global commodification of higher education.
Originality/value
Current public universities in Kenya have adopted a business-like approach in their operations in view of changing environment and have adopted coping strategies. Therefore, understanding the factors that influence the choice of response strategies is important for improvement of quality, efficiency and effectiveness as well as in policy formulation and serve as a guide to strategic management.
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Norman T. Sheehan and Nicolai J. Foss
Porter's activity‐based view of the firm is a comprehensive strategic framework which analyzes firm‐level competitive advantage. Although Porter's activity‐based view is widely…
Abstract
Purpose
Porter's activity‐based view of the firm is a comprehensive strategic framework which analyzes firm‐level competitive advantage. Although Porter's activity‐based view is widely cited by academics, taught to students, and applied by practitioners, little is known about its intellectual roots. Given that a framework's intellectual antecedents not only determine its current content, but also its future development, this paper aims to examine the intellectual roots of Porter's activity‐based view and the value chain.
Design/methodology/approach
The paper examines Porter's writings in an effort to document his influences while developing the activity‐based view and value chain. Porter's and other scholars' explanations are found to be lacking, so the paper ventures further down paths first suggested by Porter and others.
Findings
Whereas Porter's five forces framework built on the existing industrial organization paradigm, the activity‐based view is not derived from any existing paradigms. While consultants of the 1970s impacted Porter's development of the value chain and the activity‐based view, its deeper roots lay in operations research, particularly activity analysis; and the work of Arch Shaw, who was the first to teach a business policy course at Harvard Business School. Porter's contribution is to bring the diverse threads together into a coherent whole which managers can apply to analyze and improve their competitive positions.
Practical implications
Following Porter, the authors argue that activities are a key link between resource holdings and strategic positions. Therefore, it is only when the activity‐based and resource‐based views are integrated that they provide a comprehensive explanation of firm value creation.
Originality/value
The paper is the first to critically examine the intellectual antecedents of the activity‐based view.
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Medical education is an evidence-driven professional field that operates in an increasingly regulated environment as compared to other fields within universities. The purpose of…
Abstract
Purpose
Medical education is an evidence-driven professional field that operates in an increasingly regulated environment as compared to other fields within universities. The purpose of this paper is to establish the extent to which Porter’s five competitive forces framework (Porter, 2008) can drive the management of medical schools in Australia.
Design/methodology/approach
Drawing on data from semi-structured interviews with over 20 staff from 6 case study Australian medical schools, this paper explores Australian medical education, by looking at the current policy context, structure and interactions between organizations within the system.
Findings
The findings provide evidence that environmental forces affect the nature of competition in medical education, and that competitive advantage can be gained by medical schools from a sustained analysis of the industry in which they operate in. Consequently, it is possible to apply a pre-dominantly profit-oriented framework to higher education.
Research limitations/implications
As an industry facing increasing pressure toward marketization and competition, the findings provide sufficient evidence that an analysis of higher education as an industry is possible.
Practical implications
The findings provide evidence that strategic leadership and management in higher education should encompass greater levels of delegation and decision making at all levels. Effective leadership should focus on creating an inspiring vision of the future through a sustained analysis of the industry in which they operate.
Originality/value
The study has made a key contribution through an industry analysis of Australian medical education, which provide important implications for leadership and management in higher education. The study is of significant value to researchers as well as senior management in higher education.
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G.D. Karagiannopoulos, N. Georgopoulos and K. Nikolopoulos
To investigate the impact of the internet in “traditional” market rules.
Abstract
Purpose
To investigate the impact of the internet in “traditional” market rules.
Design/methodology/approach
An opinion piece based on Michael Porter's arguments for the new economy.
Finding
Michael Porter's arguments for the new economy provide a useful starting point in the analysis of the environment. His arguments are based on exaggerated phenomena. Factors that determine a sector's profitability could be enriched with the innovation that prevails in the particular sector.
Originality/value
An attempt to criticize Porter's thoughts regarding internet and industry structure and to enrich the Porter's five forces model with the “power of innovation”.
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N. Mohan Das Gandhi, V. Selladurai and P. Santhi
Modelling of sustainable development is essential, as environmental protection is regarded as a top global priority in the twenty‐first century. The basic objective of this paper…
Abstract
Purpose
Modelling of sustainable development is essential, as environmental protection is regarded as a top global priority in the twenty‐first century. The basic objective of this paper is to provide a conceptual framework, named the Four Forces model for diagnosing the process of sustainable development.
Design/methodology/approach
Michael Porter's Five Forces model serves as a starting‐point to derive the Four Forces model. The Four Forces model, which is developed based on Back Casting technique, shows the transformation process from current unsustainable development to future sustainable development through environmental degradation, greening force and greening process. These five major components are related based on cause and effect.
Findings
The paper reveals that a clear understanding of the transformation process and their integration is necessary for successful implementation of sustainable development projects, as the transformation is a continuous process. The Four Forces model is a generic and contribute towards a richer understanding of sustainable development process.
Research limitations/implications
The suggested conceptual model provides a holistic view of sustainable development and does not attempt to provide a detailed, step‐by‐step approach for implementing sustainable development in industries. This paper helps to initiate future studies in this area.
Originality/value
In line with Michael Porter's three generic competitive strategies, this study analysis various greening strategies and greening tools and also recommends the Green Productivity as a better tool for implementing sustainable development in industries. The model can be used as a framework for further development of a practical sustainable development system in industries.
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Amanpreet Singh, Prem Chhetri and Rajiv Padhye
The paper models the effect of spatial clustering on various dimensions of inter-firm competitive rivalry among port logistics firms using Porter's five forces model.
Abstract
Purpose
The paper models the effect of spatial clustering on various dimensions of inter-firm competitive rivalry among port logistics firms using Porter's five forces model.
Design/methodology/approach
A survey-based quantitative approach is adopted to collect data from logistics firms, which are directly or indirectly dependent on the Port of Melbourne in Australia. A structural equation modelling (SEM) technique is used to examine the theorised relationships between various dimensions of inter-firm competitive rivalry and the tendency of spatial clustering of logistics firms in the vicinity of Port of Melbourne.
Findings
The results indicate that the inter-firm competitive rivalry increases significantly when logistics firms are spatially clustered. This effect is further augmented when they cluster around the port. Co-location of firms near the port tends to increase “bargaining power of buyers”, whilst indirectly affecting “competitive rivalry” via “threats of substitutes”. This indicates that co-location enhances the bargaining power of buyers through the greater availability of substitute services that in turn promotes competitive rivalry among firms. However, co-location has an insignificant effect on “barriers to entry” and “bargaining power of suppliers”. Low entry barrier thus favours high competitive rivalry among firms. Hence, this paper validates the Porter's cluster and five forces models that confirm the positive effect of port logistics clusters (PLCs) on bargaining power of buyers and indirect effect on competitive rivalry partially mediated through threats of substitutes.
Practical implications
This study provides empirically grounded evidence for firms to evaluate co-location decision choices and help buyers and sellers to devise business strategies to enhance inter-firm competitive rivalry and bargaining power.
Originality/value
This is the first systematic attempt to empirically validate Porter's five forces model in the context of PLC. Furthermore, the conceptualisation of PLC concept both as spatial and functional constructs (i.e. dependency on port) is novel. This study thus has broadened the meaning of cluster from a geographic entity to a more useful functional construct to reflect inter-firm dependencies.
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Daniel Schwenger, Thomas Straub and Stefano Borzillo
This paper aims to empirically investigate competition within the non-governmental organization (NGO) sector, and presents some strategic approaches to managing it. Porter’s five…
Abstract
Purpose
This paper aims to empirically investigate competition within the non-governmental organization (NGO) sector, and presents some strategic approaches to managing it. Porter’s five forces (1980) model was used as a theoretical framework to understand and quantify competition in the NGO sector, as well as to explore the differences between NGOs’ budget sizes. Traditional strategic management often fails to meet NGOs’ needs. While economization is prevalent within the NGO sector, little is known about how NGOs address competition.
Design/methodology/approach
An online global survey was conducted between November 2010 and May 2011. Data were collected from 1,211 NGOs that either function as consultants or work in association with the United Nations (UN). The key informants were leaders and executive managers of NGOs. The respondents’ fields of work varied from international advocacy and development (38 per cent), education and research (14 per cent), community and neighborhood (8 per cent), health (8 per cent), environment (8 per cent) and social services (7 per cent) to civil liberty (6 per cent), labor (6 per cent), culture (3 per cent), philanthropy (2 per cent) and religion (1 per cent).
Findings
The findings suggest that the NGO sector is becoming increasingly competitive. However, the data suggest that the lower and upper budget classes have different priorities and perceptions. Small NGOs (with budgets <USD250,000 and especially <USD10,000) compete more aggressively for funding, as they have less bargaining power over donors and large foundations, and face stronger competition from social entrepreneurship. This results in income reductions. Large NGOs (with budgets >USD250,000 USD and especially >USD1 million) experience increased pressure for accountability.
Research limitations/implications
This research is aimed at a wide range of NGOs. The findings are based on an empirical and open survey that was held among NGOs in association with the UN. Future research should survey NGOs that are not associated with the UN to generalize the results. This may lead to contradictory or more varied results.
Practical implications
The findings can help NGOs adapt their strategy to cope more effectively with increasing competition in the sector. Large NGOs seem to prioritize fundraising measures and their positioning (uniqueness) through specialized knowledge. Small NGOs, on the other hand, seem to consider sharing resources, co-operation with other NGOs and co-operation with the private sector slightly more important. To enhance their competitive position, small NGOs are advised to improve their potential by concentrating on developing specific skills that are hard to imitate and to improve their fundraising measures. Finally, large NGOs could benefit from pooling their resources and collaborating with other NGOs and private organizations.
Originality/value
NGOs have to pursue their missions under increasing competitive pressure. This paper comprehensively assesses competition, analyzes the various facets thereof and tests these aspects’ relevance to NGOs. It furthermore proposes strategies that are more appropriate for NGOs of different sizes to cope with this competition.
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Euripidis Loukis, Ioakim Sapounas and Konstantinos Aivalis
This paper aims to investigate the effect of two external factors – the “generalized” competition an organization faces, and the strategy it follows in response to its external…
Abstract
Purpose
This paper aims to investigate the effect of two external factors – the “generalized” competition an organization faces, and the strategy it follows in response to its external environment – on the business value generated by its ICT investment.
Design/methodology/approach
For achieving these research objectives econometric models of output are constructed, using firm‐level data from Greek companies, which have been collected through a survey through a structured questionnaire. These econometric models are based on the microeconomic production theory (Cobb Douglas production function). For operationalizing the “generalized competition” an organization faces are used the five dimensions of the generalized competition of M. Porter's “five forces framework”.
Findings
Concerning the above generalized competition dimensions it is concluded that higher level of bargaining power of suppliers results in higher ICT business value generation. Also, concerning strategy it is concluded that in organizations following a strategy of frequent introduction of new innovative products and services is generated higher ICT business value.
Originality/value
This paper investigates the effect of external environment related factors on the business value generated by ICT investment. The conclusions constitute of first evidence that there are external conditions that result in higher business value from ICT investment by necessitating a more efficient and effective use of ICT.
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Manjeet Kharub and Rajiv Sharma
The purpose of this paper is to measure and analyze the competitive advantage of micro, small and medium enterprises (MSMEs) based upon the Porter’s diamond framework. The major…
Abstract
Purpose
The purpose of this paper is to measure and analyze the competitive advantage of micro, small and medium enterprises (MSMEs) based upon the Porter’s diamond framework. The major objective is to contribute toward better understanding of various determinants of the diamond model in context within Indian MSMEs.
Design/methodology/approach
Extent review of the literature has been done to identify various critical factors contributing to developing a competitive advantage. Exploratory factor analysis and internal consistency tests were performed to verify scales validity and reliability of measuring instrument (questionnaire). In research design, a case study approach has been used, in which MSMEs operating in the pharmaceutical, electrical and electronics, automobile, food and textile sectors were considered.
Findings
Study findings indicate that the pharmaceutical sector is more competitive followed by food (112.491) as revealed by the high value of surface area i.e. 150.931. The competitiveness among MSME sectors is mostly affected by demand conditions followed by firm strategy, structure and rivalry. Moreover, the score of diamond axes indicates significant difference with respect to determinants. For instance, in the textile sector, the determinants such as factor conditions and related and supporting industries scored low, for example, 4.710 and 4.280, respectively, which indicates it needs to be strengthened as this sector stands at last position with minimum surface area, for example, 67.398.
Research limitations/implications
Owing to the time and resource constraints, this study was conducted in MSMEs situated in the state of Himachal Pradesh, India, and thus generalizations of results are rather limited.
Practical implications
This study is one of the original being undertaken by authors which helps to underline the importance of various determinants which may help the MSME units to improve competitiveness by implementing effective competitive strategies. The study could be extended to other regions of the country.
Originality/value
This study is a result of extended research on competitiveness and provides an instrument to measure firm ability to be competitive. CEO’s, managers and policy makers from industries as well as government will be able to use this to evaluate their competitive positioning and identify key problem areas which required improvements.
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