Sunteți pe pagina 1din 27

Chapter

3
Analyzing a Companys
External Environment
Screen graphics created by:
Jana F. Kuzmicki, Ph.D.
Troy State University-Florida and Western Region
3-1 McGraw-Hill/Irwin

2005 The McGraw-Hill Companies, Inc. All rights reserved.

Chapter Roadmap
The Strategically Relevant Components of a Companys External

Environment
Thinking Strategically About a Companys Industry and Competitive
Environment
Question 1: What Are the Industrys Dominant Economic Features?
Question 2: What Kinds of Competitive Forces Are Industry
Members Facing?
Question 3: What Factors Are Driving Industry Change and What
Impacts Will They Have?
Question 4: What Market Positions Do Rivals OccupyWho Is
Strongly Positioned and Who Is Not?
Question 5: What Strategic Moves Are Rivals Likely to Make
Next?
Question 6: What Are the Key Factors for Future Competitive
Success?
Question 7: Does the Outlook for the Industry Present an Attractive
Opportunity?
3-2 McGraw-Hill/Irwin

2005 The McGraw-Hill Companies, Inc. All rights reserved.

What Is Situation Analysis?


Two considerations
Companys

external or
macro-environment
Industry and competitive conditions

Companys

internal or
micro-environment
Competencies, capabilities,

resource strengths and weaknesses,


and competitiveness
3-3 McGraw-Hill/Irwin

2005 The McGraw-Hill Companies, Inc. All rights reserved.

Fig. 3.1: From Thinking Strategically


about the Companys Situation
to Choosing a Strategy

3-4 McGraw-Hill/Irwin

2005 The McGraw-Hill Companies, Inc. All rights reserved.

Fig. 3.2: The Components of a


Companys Macro-Environment

3-5 McGraw-Hill/Irwin

2005 The McGraw-Hill Companies, Inc. All rights reserved.

Key Questions Regarding the


Industry and Competitive Environment
Industrys
dominant
economic traits
Competitive
forces and
strength of
each force

Competitor
analysis
3-6 McGraw-Hill/Irwin

Drivers of
change in the
industry

Key success
factors

Conclusions:
Industry
attractiveness

2005 The McGraw-Hill Companies, Inc. All rights reserved.

Q #1: What are the Industrys


Dominant Economic Traits?
Market size and growth rate
Scope of competitive rivalry
Number of rivals

Buyer needs and requirements


Production capacity
Pace of technological change

Vertical integration
Product innovation
Degree of product differentiation

Economies of scale
Learning and experience curve effects
3-7 McGraw-Hill/Irwin

2005 The McGraw-Hill Companies, Inc. All rights reserved.

Q #2: What Kinds of Competitive


Forces Are Industry Members Facing?
Objectives are to identify
Main

sources of competitive forces

Strength

of these forces

Key analytical tool


Five

Forces Model
of Competition

3-8 McGraw-Hill/Irwin

2005 The McGraw-Hill Companies, Inc. All rights reserved.

Fig. 3.3: The Five Forces


Model of Competition

3-9 McGraw-Hill/Irwin

2005 The McGraw-Hill Companies, Inc. All rights reserved.

Fig. 3.4: Weapons for Competing and


Factors Affecting Strength of Rivalry

3-10 McGraw-Hill/Irwin

2005 The McGraw-Hill Companies, Inc. All rights reserved.

What Are the Typical


Weapons for Competing?
Vigorous price competition

Bigger/better dealer network

More or different

Low interest rate financing

performance features
Better product performance
Higher quality
Stronger brand image and

appeal
Wider selection of models

and styles
3-11 McGraw-Hill/Irwin

Higher levels of advertising


Stronger product innovation

capabilities
Better customer service
Stronger capabilities to

provide buyers with custommade products


2005 The McGraw-Hill Companies, Inc. All rights reserved.

Fig. 3.5: Factors Affecting


Strength of Threat of Entry

3-12 McGraw-Hill/Irwin

2005 The McGraw-Hill Companies, Inc. All rights reserved.

Common Barriers to Entry


Sizable economies of scale
Cost and resource disadvantages independent of size

Brand preferences and customer loyalty


Capital requirements and/or other

specialized resource requirements


Access to distribution channels
Regulatory policies

Tariffs and international trade restrictions


3-13 McGraw-Hill/Irwin

2005 The McGraw-Hill Companies, Inc. All rights reserved.

Fig. 3.6: Factors Affecting


Competition From Substitute Products

3-14 McGraw-Hill/Irwin

2005 The McGraw-Hill Companies, Inc. All rights reserved.

Fig. 3.7: Factors Affecting the


Bargaining Power of Suppliers

3-15 McGraw-Hill/Irwin

2005 The McGraw-Hill Companies, Inc. All rights reserved.

Competitive Pressures: Collaboration


Between Sellers and Suppliers
Sellers are forging strategic partnerships

with select suppliers to


Reduce

inventory and logistics costs

Speed

availability of next-generation
components

Enhance

quality of parts being supplied

Squeeze

out cost savings for both parties

Competitive advantage potential may accrue to sellers

doing the best job of managing supply-chain relationships


3-16 McGraw-Hill/Irwin

2005 The McGraw-Hill Companies, Inc. All rights reserved.

Fig. 3.8: Factors Affecting


Bargaining Power of Buyers

3-17 McGraw-Hill/Irwin

2005 The McGraw-Hill Companies, Inc. All rights reserved.

Strategic Implications of the


Five Competitive Forces
Competitive environment is unattractive from

the standpoint of earning good profits when


Rivalry

is vigorous

Entry

barriers are low


and entry is likely

Competition

from
substitutes is strong

Suppliers

and customers have


considerable bargaining power

3-18 McGraw-Hill/Irwin

2005 The McGraw-Hill Companies, Inc. All rights reserved.

Strategic Implications of the


Five Competitive Forces
Competitive environment is ideal from

a profit-making standpoint when


Rivalry

is moderate

Entry

barriers are high


and no firm is likely to enter

Good

substitutes
do not exist

Suppliers

and customers are


in a weak bargaining position

3-19 McGraw-Hill/Irwin

2005 The McGraw-Hill Companies, Inc. All rights reserved.

Q #3: What Factors Are Driving Industry


Change and What Impacts Will They Have?

Industries change because forces

are driving industry participants


to alter their actions

Driving forces are the

major underlying causes


of changing industry and
competitive conditions
3-20 McGraw-Hill/Irwin

2005 The McGraw-Hill Companies, Inc. All rights reserved.

3-21 McGraw-Hill/Irwin

2005 The McGraw-Hill Companies, Inc. All rights reserved.

Question 4: What Market


Positions Do Rivals Occupy?
One technique to reveal

different competitive positions


of industry rivals is
strategic group mapping

A strategic group is a

cluster of firms in an industry


with similar competitive
approaches and market positions
3-22 McGraw-Hill/Irwin

2005 The McGraw-Hill Companies, Inc. All rights reserved.

Strategic Group Mapping


Firms in same strategic group have two or more

competitive characteristics in common


Have
Sell

comparable product line breadth

in same price/quality range

Emphasize

same distribution channels

Use

same product attributes to appeal


to similar types of buyers

Use

identical technological approaches

Offer

buyers similar services

Cover
3-23 McGraw-Hill/Irwin

same geographic areas


2005 The McGraw-Hill Companies, Inc. All rights reserved.

Q #5: What Strategic Moves


Are Rivals Likely to Make?
A firms best strategic moves are affected by
Current
Future

strategies of competitors

actions of competitors

Profiling key rivals involves gathering

competitive intelligence about


Current
Most

strategies

recent actions and public announcements

Resource
Efforts

being made to improve their situation

Thinking
3-24 McGraw-Hill/Irwin

strengths and weaknesses


and leadership styles of top executives
2005 The McGraw-Hill Companies, Inc. All rights reserved.

Q #6: What Are the Key Factors


for Competitive Success?
KSFs are those competitive factors most affecting every

industry members ability to prosper. They concern

Specific strategy elements

Product attributes

Resources

Competencies

Competitive capabilities

that a company needs to have to be competitively successful


KSFs are attributes that spell the difference between

Profit and loss

Competitive success or failure

3-25 McGraw-Hill/Irwin

2005 The McGraw-Hill Companies, Inc. All rights reserved.

3-26 McGraw-Hill/Irwin

2005 The McGraw-Hill Companies, Inc. All rights reserved.

Q #7: Does the Outlook for the Industry


Present an Attractive Opportunity?
Involves assessing whether the industry

and competitive environment is attractive


or unattractive for earning good profits
Under certain circumstances, a firm uniquely

well-situated in an otherwise unattractive industry


can still earn unusually good profits
Attractiveness

is relative, not absolute

Conclusions

have to be drawn from the


perspective of a particular company

3-27 McGraw-Hill/Irwin

2005 The McGraw-Hill Companies, Inc. All rights reserved.

S-ar putea să vă placă și