What are the critical drivers of industry profitability (think of Porter's 5 forces)? Pick a driver and discuss how the driver can affect industry profitability.
An industry is a group of firms which market the products that are closely related to each other. An example of an industry is the car industry that has a lot of companies producing car but of different brands. The gaining of profits by an industry boots the operations of the company. This is usually determined by the great leadership of the company that addresses the major issues of the company and the addressing of the correct strategies that are relevant to the operations of the company. The understanding of the dynamics of the competitive structure of an industry will enable it to attain profitability. The most influential and analytical model that a company can use to assess the nature of the competition in the industry is the Michael Porter's five force model products (Industry Handbook, 2011).
Porter's 5 Forces:
This is a frame work for the industry analysis and business strategy that was developed by Michael E. Porter. To create attractiveness of the business, the framework has derived five forces that will be used in the industrial organization. Porter states that there are five forces in the market to determine the attractiveness of the industry that will eventually lead to ...
The critical drivers of industry profitability using Porter's five forces are determined.