One of the most popular frameworks for examining a firm’s competitive environment is Porter’s five forces Also known as Industry and Competitive Analysis. If you have a model for thinking about competition, it’s easier to understand what’s happening and to think creatively about possible solutions. Frameworks can also be used as brainstorming tools to generate new ideas for responding to industry competition. While there is no silver bullet for strategy creation, strategic frameworks help managers describe the competitive environment a firm is facing. Hamel, “Killer Strategies that Make Shareholders Rich,” Fortune, June 23, 1997.
Professor and strategy consultant Gary Hamel once wrote in a Fortune cover story that “the dirty little secret of the strategy industry is that it doesn’t have any theory of strategy creation.” G. Apply the framework to an industry, assessing the competitive landscape and the role of technology in influencing the relative power of buyers, suppliers, competitors, and alternatives.Diagram the five forces of competitive advantage.
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