Gnapika Reddy Kudumula Sep 16,2017
MSIS_620L Emerging Technologies
Marcus. Ch.3. Hedging the Uncertainty Reflection Paper
“Technological change is not smooth. Positive and negative developments are hard to predict.”
Organizations must carefully invest in changing technologies to earn a profit. It is hard to estimate the technical success of a product and its market success. It is necessary that organizations recognize opportunities and threats, and generate moves that can facilitate successful commercialization. It is impossible to predict what will happen next in the market, so organizations must carefully invest and should be prepared for both the positive and negative outcomes as well as some surprises. To foresee the future and manage uncertainty organizations follow certain frameworks like following trends, relying on an expert’s opinion, conducting industrial analysis, searching for analogies from the past and constructing scenarios. All these frameworks rely on the past patterns and the present market conditions to analyze the future, but its certain that past does not fully reproduce itself in the future. These frameworks also help us to compare the events in the past to the events in future
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Answer: According to professor Michael Porter, the five forces are suppliers, customers, competitors, new entrants, and substitutes. The “plus” part of the model takes into account the elements outside the industry like technology, population and security, politics and economics, energy, and environment.
2) What is Baysean judgment approach?
Answer: Baysean judgment is based on learning. It offers more flexibility and room for adjustment in the face of unexpected developments and represents an improvement on the naive view that what happened earlier will occur again, but it does not entirely eliminate
Porter’s 5-Forces Model: A method for examining the competitive environment for a company or industry. It specifies and evaluates threats from new entrants, suppliers, buyers, and substitutes in the arena of competition.
22. The Porter's Five Forces Model analyzes the competitive forces within the environment in which a company operates to assess the potential for __________ in an industry.
The ‘five forces’ model was created by Michael Porter of Harvard University and consists of three horizontal forces of competition, as well as two vertical forces of competition. The horizontal forces of competition are comprised of: 1) the threat of new entrants; 2) the threat of rivals who have already been established; and 3) the threat of substitute services or products. The vertical forces of competition include the bargaining power of customers, as well as the bargaining power of suppliers.
Porter's Five Forces is a simple but powerful tool that consist of 5 different forces to understand the competitiveness of your business environment, and for identifying your strategy's potential profitability. The five forces are degree of rivalry, threat of entry, threat of substitutions, buyer power, and supplier power. Each force is helpful in their own way to get to know your rivals a lot better and get to know what can happen in your market.
Porter’s Five Forces is a framework that consists of five competitive forces, threat of entry, power of supplier and buyer, threat of substitution and competitive rivalry. These forces facilitate the analysis of the task environment of an industry or company (Wheelen and Hunger, 2009).
The Porter Five forces analysis is a structure for business management developed by Michael Porter in 1979. It uses concepts developed in Industrial Organization economics to derive five forces that determine the attractiveness of a market. Porter referred to these forces as the microenvironment, to contrast it with the more general term microenvironment. They consist of those forces close to a company that affect its ability to serve its customers and make a profit. This concept involves a relationship between competitors within an industry, potential competitors, suppliers, buyers and alternative solutions to the problem being addressed. A change in any of the forces normally requires a company to re-assess the marketplace.
The company understands that in a fast changing business environment it is essential to forecast the future trends and bottlenecks thus helping them prepare for any circumstances that may come up. The 2020
Michael Porter wrote about five forces affecting the profitability and viability of companies. The five forces are existing competitors, new entries into the market, substitute products, bargaining power of customers, and the bargaining power of suppliers. (quickmba)
The 5 forces are the environmental forces that impact on the companies ability to compete in the given market. The purpose of 5 forces analysis is to diagnose the principal competitive pressures in a market and assess how strong and important each one is.
According to Porter, the nature of competition in any industry is handled by the following five forces:
The five forces examines the dynamics within an industry. Understanding the competitive forces, and their underlying causes, reveals the roots of an industry’s current profitability while providing a framework for anticipating and influencing competition and profitability over time. Understanding the structure of its industry is also essential to effective strategic positioning.
Porter’s five forces analysis is a tool is useful for us to analyse the threat of competition in an industry. Porter believed that the industries were influenced by five forces; competitive rivalry, threat of new entrants, bargaining power of suppliers, bargaining power of buyers, and the threat of substitutes. Analysing these areas can allow you to see attractiveness of the market and find a competitive advantage.
In the five forces model by Porter, four forces will influence the fifth one (see the model on the right). The bargaining power of suppliers, the bargaining power of customers, the threat of substitute products and the threat of new entrants will influence the fifth force: the level of competition in the industry (S.Clegg, C.Carter, M.Kornberger, & J.Scheitzer, 2011).
Porter’s 5 Forces analysis is a commonly used business theory that identifies the 5 competitive forces of an industry. By identifying and analysing these forces you can determine an industries weaknesses and strengths. Porter recognised the 5 forces in most business markets to be internal rivalry, entry, substitutes and compliments, supplier power and buyer power.
The Porter`s five forces are threats of new entrants, the bargaining power of buyers ,product substitution and intensity of rival of rival among competitors .These forces measure the competitiveness of the market and also helps the company to identify strategies to use to penetrate such and gain market share.