Porter's Competitive Forces Model

Presented By : AAYUSHI SINGH (221002) GAURAV MAHESHWARI (221049)

CONTENT
History
Introduction Objective Detailed Study References

Michael E. Porter
Born in 1947.

Professor at Harvard

Business School. Introduced Porter's 5 Forces Model.

Author, Management Consultant

Introduction
Most widely used model for understanding

competitive advantage
Provides a general view of the firm, its competitors

and the firms environment

By studying the structure of the model and

dynamics between these forces, a company can discover opportunities for improving upon its strategies

Porters Competitive Forces Model

Objectives of Porters Model

To make a qualitative evaluation of a firm's

strategic position
To identify whether new products, services or

businesses have the potential to be profitable

To Analyze Competitors position For Creating new strategies, plans and

investment decision

The Five Competitive Forces

Traditional Competitors
New Market Entrants

Substitute Product and Services

Customers Suppliers

Strategies for Dealing with Competitive Forces

Low-Cost Leadership
Product Differentiation Focus on Market Niche Strengthen Customer and Supplier

Intimacy

Any Questions?

Traditional Competitors
Pose a potential threat by introducing new

products and services

Attempt to attract customers through their existing

brand value

New Market Entrants

Number of entrants vary depending on the type of

business
Advantages and disadvantages lying with them :

Young workers b. Not encumbered by old brands

a.

Substitute Products and Services

New Technologies create new Substitutes every

time
More Substitutes => Lesser Control on Price =>

Lower Profits

Customers
Attracting and retaining customers - Important in

determining profitability of a company

Little Product Differentiation Forces competitor's

to compete on price

Suppliers
Has a significant impact on firm profits
Different suppliers, greater control in terms of

Price b. Quality c. Delivery Schedules

a.