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Study the market, coupe with competition (direct and indirect).
New business create pressure on the market either in price, investment rate and costs
Set profit performance measures that can measure company success and productivity across industries.
Understand the market requirements and set industry structures which drives the forces
Study forces-drive up Concentrate forces-drive down profitability.
The five completive strategy forces Potential new entrants/industries Customers i.e. buyers Current Competitors Mixed Products Suppliers
It is important to study the strategy formulation
◦ Create additional capacity ◦ Affect prices and profit margin ◦ Affect supply e.g.. Intel and demand scale e.g..,
eBay◦ Switch and decrease customer costs◦ Invest and study capital requirements ◦ Seize ad opportunities and advantages
independent of size. ◦ Access availability to different market channels
with low costs . et a structured and restrictive government policy and procedures
◦ Expand the business off-shore e.g.. Retail Associations in India)
Reliability and customer order fulfillment e.g.. Bloomberg i.e. dependency
The more supplier power the more value is created for their business e.g.. Microsoft.
Supply mixed products that maintain organization position in competitive advantage market.
Create a high number of customers that increase productivity and decrease costs
More customers create a big customer database
Concentrate in building up a strong few buyers but with high quantity of orders or volumes, e.g., SNL
Standardization of work procedures and products
Minimize operational costs by eliminating non-added value activities.
Reduce costs and operational expenses Cheaper raw materials, accordingly ability
to offer cheap products/ service Overcome any level of uncertainty or trade
off during the different flow of information or mater processes
Decrease operational expenses
There are different impacts that affect the revivals; Increase size of competitors in same industrial or equivalent,Slow and decrease the growth rate same size, Increase exit barriers levels, Price competition
Industrial requirements; ◦ Study the growth rate ◦ Introducing new technology and innovation ◦ Changes in government policies ◦ Introducing bundles products e.g.. Software with
computers Define industry size
◦ Service and product scope◦ Geographical Scope
Industrial Structures Changes◦ Develop and introduce developments methods to dictate ad cope
with changes◦ Develop a strong supplier – customer relationship ◦ Study new rivals threats ◦ Study opportunities of outsource and sub-contracting◦ Industrial Structures Changes
Value stream the five forces that can highlight non-added activities within the processes.
Conduct and applied advanced techniques as SWOT analysis
Maintain and sustain the company position in the market. Introduce new technologies to the industry e.g.. Apple and
i-tunes, Expand profit opportunities Reshape the structure of the company to meet market
requirements Identify different external and internal factors that can
affect the company Draft common mistakes by applying best practices Explore different future opportunities Analyze future internal and external changes and identify
positive and negative impacts.