Porter Five Forces in the Robotics Industry

1719 Words Mar 28th, 2014 7 Pages
Porter’s Five Forces in the Robotics Industry
Iryna Varniaga
University of Maryland University College
Fall 2013

Turnitin score: 25%

Porter’s Five Forces in the Robotics Industry “Porter’s five forces”: Introduction. “Porter’s five forces” is widely applied in today’s business world. Harvard Professor Michael E. Porter’s first HBR article “How competitive forces shape strategy” was published in 1979. It became revolutionary in the field of strategy. Porter’s subsequent work has brought big changes to the study of competitive strategy for corporations, regions, and nations. With assistance from his colleagues from Harvard Business School, Porter continues to update and extend his classic work, providing practical guidance for
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The industrial robots are applied in all branches of the industry. The highest level of application is in the automobile industry, but the number of installed robots is increasing in other industries as well (Karabegovic, Dolecec, Husak, 2011). As the information technology is constantly developing and there are permanent changes in industrial robotics, new functional solutions and higher possibilities of the industrial robots applications are expected in the foreseeable future (Karabegovic, 2013). The extended rivalry model, developed by Porter, will be applied to the robotics industry to determine how attractive this industry is. By evaluating the strength of individual forces (potential entrants, rivals, substitutes, buyers, and suppliers), it is possible to determine the degree to which forces of globalization influence the structure of the robotic industry. Existing Competitors. Rivalry among competitors within an industry use price discounting, new products, marketing, and other techniques to be competitive. Profitability of an industry suffers from high rivalry. The intensity with which companies compete and the basis on which they compete determine to which degree rivalry brings down an industry’s profitability (Porter, 2008). Pure competition is considered by economists as a competition with a high