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    Strategic Management - I: Porter'S 5 Forces Model

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    sanket verma
    This document discusses key concepts in strategic management including Porter's Five Forces model, value chain analysis, VRIO framework, strategies for two-sided markets, and blue ocean strategy. Porter's Five Forces model analyzes industry attractiveness but does not account for dynamism over time. Value chain analysis and VRIO framework are used for internal analysis to identify a firm's valuable activities and resources. Two-sided market strategies must consider network effects, pricing both sides of the platform, and threats from competitors. Blue ocean strategy creates new market space by changing the value curve to provide new customer value at lower cost.

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    Strategic Management - I: Porter'S 5 Forces Model

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    sanket verma
    62 views4 pages
    This document discusses key concepts in strategic management including Porter's Five Forces model, value chain analysis, VRIO framework, strategies for two-sided markets, and blue ocean strategy. Porter's Five Forces model analyzes industry attractiveness but does not account for dynamism over time. Value chain analysis and VRIO framework are used for internal analysis to identify a firm's valuable activities and resources. Two-sided market strategies must consider network effects, pricing both sides of the platform, and threats from competitors. Blue ocean strategy creates new market space by changing the value curve to provide new customer value at lower cost.

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    This document discusses key concepts in strategic management including Porter's Five Forces model, value chain analysis, VRIO framework, strategies for two-sided markets, and blue ocean strategy. Porter's Five Forces model analyzes industry attractiveness but does not account for dynamism over time. Value chain analysis and VRIO framework are used for internal analysis to identify a firm's valuable activities and resources. Two-sided market strategies must consider network effects, pricing both sides of the platform, and threats from competitors. Blue ocean strategy creates new market space by changing the value curve to provide new customer value at lower cost.

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    62 views4 pages

    Strategic Management - I: Porter'S 5 Forces Model

    Uploaded by

    sanket verma
    This document discusses key concepts in strategic management including Porter's Five Forces model, value chain analysis, VRIO framework, strategies for two-sided markets, and blue ocean strategy. Porter's Five Forces model analyzes industry attractiveness but does not account for dynamism over time. Value chain analysis and VRIO framework are used for internal analysis to identify a firm's valuable activities and resources. Two-sided market strategies must consider network effects, pricing both sides of the platform, and threats from competitors. Blue ocean strategy creates new market space by changing the value curve to provide new customer value at lower cost.

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    of 4

    Strategic Management – I

    By 17P118 –Vivek Phuloria

    PORTER’S 5 FORCES MODEL


    Pre-Midterm we started with strategic analysis which comprised of internal and external
    analysis. In external analysis we discussed the Porter’s Five Forces Model to analyse
    the industry attractiveness. The Porter’s Five Forces are

    These forces are to be analysed with respect to the incumbent players. The main drawback
    of this model is that it gives the analysis of the Industry at a point in time and hence is not
    dynamic.

    After external analysis we discussed the value chain analysis and VRIO framework
    under the internal analysis for a company.
    Value chain analysis
    Value chain analysis is a strategy tool used to analyse internal firm activities. Its goal is to
    recognize, which activities are the most valuable (i.e. are the source of cost or
    differentiation advantage) to the firm and which ones could be improved to
    provide competitive advantage.
    VRIO
    VRIO analysis stands for four questions that ask if a resource is: valuable? rare? costly to
    imitate? And is a firm organized to capture the value of the resources? A resource or
    capability that meets all four requirements can bring sustained competitive advantage for
    the company.
    Strategies for Two sided markets

    In traditional markets value chain, the value moves from left to right, to the left of the
    company is Cost and to the right is the revenue. But in case of two sided markets the cost
    and revenues are on both the sides.

    In two-sided market strategies we studied the network effects and how they are important
    in achieving the scales. We also discussed the various challenges we face while devising
    the strategy for two sided markets.

    These challenges are

    1. Pricing the platform


    2. Winner takes all dynamics and
    3. The threat of envelopment.

    In two sided markets there is a money side and a subsidy side. If we provide subsidy to
    one of the sides and increase their presence on the platform then due to positive cross
    side network effect the money side numbers increase which then can be monetized. Hence
    it is important to determine which side to subsidize and which side to monetize.

    Fin we discussed the blue ocean strategies.

    Blue ocean strategy generally refers to the creation by a company of a new, uncontested
    market space that makes competitors irrelevant and that creates new consumer value
    often while decreasing costs.

    We discussed the four-action framework to change the value curve to create a blue
    ocean within the existing space.

    The Four Actions Framework is used to reconstruct buyer value elements in crafting a new
    value curve or strategic profile. To break the trade-off between differentiation and low cost
    in creating a new value curve, the framework poses four key questions, shown in the
    diagram, to challenge an industry’s strategic logic.

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