Why are Porter’s forces important to strategic analysis and planning?

A Harvard-based professor developed a number of theoretical models for competitiveness after conducting extensive teaching and research. These models are officially referred to as the Porters “”five forces.“

With this, he highlighted some of the five elements that influence an industry, including disputes between direct competitors, consumer bartering power, provider negotiating strength, the threat of entrants to the market, and the possibility of substitute goods or services (Grant, 2016).

Due to the fact that they widen the concept of competition and make the entity aware of potential variables that could thwart its development, these forces are essential to strategic analysis and planning. Concisely, Porter’s Five Forces model is a structure that helps entrepreneurs comprehend the components that shape rivalry in a given industry (Grant, 2016). 

Discuss in detail how do each of these forces apply to the company you identified in Learning Activity #1 above.

The Fly Emirates is also a company that is being affected by these five forces. For instance, the buyer power in which the company has to assess how easy it is for its clients to make it reduce its prices to fit in the competition with other airlines. On the other hand, the supplier power also has to be considered in that the company has to assess it providers and the strengths and input that they add to the business. Competitive rivalry is another issue; Emirates has to offer its buyers with good deals because if they do not then definitely the customers will go elsewhere in other airlines that offer better deals. The threat of substitution and new entry are other factors that might affect the airline (Grant, 2016). In threat of substitution, clients will find better airlines if you do not offer quality products while in threat of new entry, other new carriers will enter the market to cover the services that Emirates does not give its customers.

The ”Barriers to Entry“ aspect of Porter’s Five Forces measures how easy or difficult it is for new entrants to enter into the industry. Identify a barrier of entry that might be associated with the company you discussed in Learning Activity #1 above, and describe how one might address or overcome that barrier.

The biggest challenge for any organization in a competitive environment is the threats that are commonly associated with new entries and the dangers involved in pursuing new markets by organizations. The most outstanding barrier of entry that is related to the Fly Emirates is that it is not welcomed in some countries like India because of the Arabic ties that the airline has. The company must diversify its operations to fit into the Indians culture for it to penetrate their market (Gök, 2016).

References

Gök, O. (2016). Exploring the passengers’ overall perceptions of Turkish airline companies: A repertory grid analysis.

Grant, R. M. (2016). Contemporary strategy analysis: Text and Cases edition. John Wiley & Sons.