To prepare for this discussion, review Figures 3.3, p.65 from your textbook. Review an Industry Analysis for two different industries then discuss the similarities and differences between these industries by answering the following questions. Detail Porter’s Five Forces as you compare the Five Forces for both industries. Use the results from the Porter’s Five Forces framework to explain the reasons why profitability is what it is in the two different industries expressed as high, intermediate, or low. Discuss the structural features of the industry and how and why they generate either high or low profitability. Guideline: Embed course material concepts, principles, and theories (which require supporting citations) in your initial response along with at least one scholarly, Please use APA 7th edition style. 0% plagiarism Book name ( Grant, R. M. (2019). Contemporary strategy analysis (10th ed.) Hoboken, NJ: John Wiley & Sons. Print ISBN:
9781119495727, 1119495725 (Paperback), E-text ASIN: B07M5Y89K1 ) Chapter ( 3&4 ) Please find the attached slides related to the same chapters ,
CONTEMPORARY STRATEGY ANALYSIS
tenth edition
Robert M. Grant
John Wiley & Sons Ltd., 2019
Chapter 3
Industry Analysis:
The Fundamentals
1
Industry Analysis: the Fundamentals
OUTLINE
• Introduction / Objectives
• From environmental analysis to industry analysis
• Analyzing industry attractiveness
• Applying industry analysis to forecast industry profitability
• Using industry analysis to develop strategy
• Defining industries: Where to draw the boundaries
• Identifying Key Success Factors
Copyright (© 2019 John Wiley & Sons, Inc.
INTRODUCTION / OBJECTIVES
The Objectives of Industry Analysis
• To understand how industry structure drives competition,
which determines the level of industry profitability.
• To assess industry attractiveness
• To use evidence on changes in industry structure to
forecast future profitability
• To formulate strategies to change industry structure to
improve industry profitability
• To identify Key Success Factors
Copyright (© 2019 John Wiley & Sons, Inc.
FROM ENVIRONMENTAL ANALYSIS TO INDUSTRY ANALYSIS
At the Core of the Macro Environment
is the Industry Environment
The national/
international
economy
Technology
Government
& Politics
The natural
environment
THE INDUSTRY
ENVIRONMENT
• Suppliers
• Competitors
• Customers
Demographic
structure
Social
Socialstructure
structure
The Macro Environment impacts the firm through its effect
on the Industry Environment
Copyright (© 2019 John Wiley & Sons, Inc.
ANALYZING INDUSTRY ATTRACTIVENESS
Profitability of Selected US Industries (median ROCE)
HIGH PROFITABILITY
%
LOW PROFITABILITY
%
Tobacco
59.9
Food and Drug Stores
10.2
Computer Software
29.8
Utilities: Gas and Electric
9.6
Household, Personal Care
25.2
Telecom Services
9.5
Semiconductors
22.5
Agricultural Processing
9.5
Pharmaceuticals
21.3
Petroleum
9.2
Entertainment
20.7
Insurance
9.1
Aerospace, Defense
19.9
Food Retailing
9.1
Beverages
19.2
Trucking
9.1
Chemicals, Specialty
18.2
Hotels, Casinos
9.0
Food Processing
18.0
Motor Vehicle Parts
9.0
Medical Products
17.5
Electrical Power
6.0
Engineering/Construction
16.8
Motor Vehicles
5.7
Restaurants/Catering
16.6
Airlines
5.1
Copyright (© 2019 John Wiley & Sons, Inc.
ANALYZING INDUSTRY ATTRACTIVENESS
The Determinants of Industry Profitability
3 key influences:
1.
The value of the product to customers
2.
The intensity of competition
3.
Relative bargaining power at different
stages of the value chain
Copyright (© 2019 John Wiley & Sons, Inc.
ANALYZING INDUSTRY ATTRACTIVENESS
The Spectrum of Industry Structures
Perfect
Competition
Oligopoly
Duopoly
Monopoly
Concentration
Many firms
A few firms
Two firms
One firm
Entry and Exit
Barriers
No barriers
Product
Differentiation
Homogeneous
Product
Potential for product differentiation
Information
availability
Perfect
Information
Imperfect availability of information
© 2019 Robert M. Grant www.contemporarystrategyanalysis.com
Significant barriers
High barriers
ANALYZING INDUSTRY ATTRACTIVENESS
Porter’s Five Forces of Competition
Framework
SUPPLIERS
Bargaining power of suppliers
INDUSTRY
COMPETITORS
Threat of
POTENTIAL
ENTRANTS new entrants
Threat of
Rivalry among
existing firms
Bargaining power of buyers
BUYERS
Copyright (© 2019 John Wiley & Sons, Inc.
substitutes
SUBSTITUTES
ANALYZING INDUSTRY ATTRACTIVENESS
The Structural Determinants of Competition
SUPPLIER POWER
• Buyers’ price sensitivity
• Relative bargaining
power
THREAT OF ENTRY
• Capital requirements
• Economies of scale
• Absolute cost advantage
• Product differentiation
• Access to distribution
channels
• Legal/ regulatory barriers
• Retaliation
INDUSTRY RIVALRY
• Concentration
• Diversity of
competitors
• Product differentiation
• Excess capacity and
exit barriers
• Cost conditions
BUYER POWER
• Buyers’ price sensitivity
• Relative bargaining
power
Copyright (© 2019 John Wiley & Sons, Inc.
SUBSTITUTE
COMPETITION
• Buyers’ propensity
to substitute
• Relative prices &
performance of
substitutes
ANALYZING INDUSTRY ATTRACTIVENESS
Threat of Substitutes
Extent of competitive pressure from producers
of substitutes depends upon:
• Buyers’ propensity to substitute
• The price-performance characteristics of
substitutes.
Copyright (© 2019 John Wiley & Sons, Inc.
ANALYZING INDUSTRY ATTRACTIVENESS
Threat of New Entry
Entrants’ threat to industry profitability depends
upon the height of barriers to entry.
The principal sources of barriers to entry are:
• Capital requirements
• Economies of scale
• Absolute cost advantage
• Product differentiation
• Access to channels of distribution
• Legal and regulatory barriers
• Retaliation
Copyright (© 2019 John Wiley & Sons, Inc.
ANALYZING INDUSTRY ATTRACTIVENESS
Bargaining Power of Buyers
The extent to which buyers are able to depress
profitability in an industry depends upon:
Buyer’s price sensitivity
• Importance of item in
relation
to buyers’ total costs.
• Differentiation of the
purchased item
• Intensity of competition
among buyers
• Whether item is critical to the
quality of buyers’ own output
Copyright (© 2019 John Wiley & Sons, Inc.
Relative bargaining power
• Size and concentration of
buyers relative to sellers.
• Buyer’s information .
• Ability to backward integrate.
NOTE: analysis of supplier
power is symmetric
ANALYZING INDUSTRY ATTRACTIVENESS
Rivalry Between Established Competitors
The extent to which industry profitability is depressed
by aggressive price competition depends upon:
? Concentration (number and size distribution of firms)
? Diversity of competitors (differences in goals, costs
strategies, etc.)
? Product differentiation
? Excess capacity and exit barriers
? Cost conditions
» Ratio of fixed to variable costs
» Extent of scale economies
Copyright (© 2019 John Wiley & Sons, Inc.
APPLYING INDUSTRY ANALYSIS TO FORECAST INDUSTRY PROFITABILITY
Applying Five-Forces Analysis to Forecast
Industry Profitability
• Perform a Five Forces Analysis to understand why the
industry’s current level of profitability is what it is
• Identify the changes in industry structure that are likely
to occur over the next few years. E.g.
– Is new entry likely?
– Will concentration increase as a result of mergers
and acquisitions?
– Will additions to industry capacity outpace the
growth in demand?
– Will innovation create new substitutes?
• Use the Five Forces Framework to predict the impact of
these structural changes on competition and
profitability
Copyright (© 2019 John Wiley & Sons, Inc.
USING INDUSTRY ANALYSIS TO DEVELOP STRATEGY
Using Industry Analysis to Develop Strategy
Strategies to Improve Industry Profitability
• Which of the structural variables that are depressing
profitability can we change by individual or collective
strategies?
Strategic Positioning
• Once we know which structural features of the industry
support profitability and which depress profitability, we
can choose a favorable positioning within the industry.
Copyright (© 2019 John Wiley & Sons, Inc.
DEFINING INDUSTRIES
Drawing Industry Boundaries
? What industry is Ferrari in?
–
–
–
–
The Motor Vehicle industry (SIC 371)
The Automobile industry (SIC 3712)
The sports car industry
Is its industry global, regional (Europe) or national (Italy)?
? Key criterion: SUBSTITUTABILITY
– On the demand side : are buyers willing to substitute between
types of cars and across countries
– On the supply side : are manufacturers able to switch production
between types of cars and across countries
We may need to draw industry boundaries differently for
different types of decision
Copyright (© 2019 John Wiley & Sons, Inc.
IDENTIFYING KEY SUCCESS FACTORS
Identifying Key Success Factors
Pre-requisites for success
What do
customers want?
How does the firm
survive competition
Analysis of competition
Analysis of demand
• Who are our
customers?
• What do they want?
• What drives competition?
What are
drives
•• What
the competition?
main
• What are the
dimensions
of main
competition?
dimensions of competition?
•How
• Howintense
intenseis
iscompetition?
competition?
• Howcan
canwe
weobtain
obtainaasuperior
•How
superior competitive
competitive
position? position?
KEY SUCCESS FACTORS
Copyright (© 2019 John Wiley & Sons, Inc.
IDENTIFYING KEY SUCCESS FACTORS
KSFs in Steel, Fashion Clothing, and Supermarkets
WHAT DO CUSTOMERS WANT?
Steel
Fashion
clothing
Supermarkets
• Low price
• Product consistency
• Reliability of supply
• Specific technical
specifications for special
steels
• Demand segmented by
garment type, style, quality,
color
HOW FIRMS SURVIVE
COMPETITION?
KEY SUCCESS FACTORS
• Strong price competition
• Cost efficiency requires either
and cyclical demand require
large plants in low-cost locations,
low costs and financial
or hi-tech, flexible, mini-mills
strength
close to customers
• Quality and service differentiation
• Intensely competitive due to • Combining differentiation with
low entry barriers, low seller
low-costs
concentration, and strong
• Key differentiation variables:
retail
buying
power
• Price premium for brand,
design, speedy to fashion trends,
style, exclusivity, and quality • Differentiation can yield
brand reputation, quality
substantial price premium,
• Mass market highly price
• Cost efficiency requires low labor
but
imitation
rapid
sensitive
costs
• Low prices
• Markets localized
• Convenient location
• Intensity of price
• Wide product range adapted
competition depends on
to local tastes
number and proximity of
competitors
• Fresh produce, good service,
pleasant ambience, easy
• Bargaining power essential
parking
to low input costs
Copyright (© 2019 John Wiley & Sons, Inc.
• Low-costs require operational
efficiency, efficient supply chain,
buying power, low wage costs.
• Differentiation requires wide
product range (hence, large
stores), convenient location, easy
parking
IDENTIFYING KEY SUCCESS FACTORS
Identifying KSFs Through Modeling
Profitability: The Airline Industry
Profitability =
Income =
ASMs
• Strength of competition on
routes.
• Responsiveness to changing
market conditions
• % business travelers.
• Achieving differentiation
advantage
Yield x Load factor – Unit Cost
Revenue
x
RPMs
RPMs
ASMs
–
Expenses
• Price competitiveness.
• Wage rates.
• Efficiency of route
planning.
• Flexibility and
responsiveness.
• Customer loyalty.
• Meeting customer
requirements.
• Fuel efficiency of
planes.
• Employee
productivity.
• Load factors.
• Administrative
overhead.
NOTE: ASM = Available Seat Miles; RPM = Revenue Passenger Miles
Copyright (© 2019 John Wiley & Sons, Inc.
IDENTIFYING KEY SUCCESS FACTORS
Identifying KSFs by Analyzing
Profit Drivers: Retailing
Sales mix of products
Return on Sales
Avoiding markdowns through
tight inventory control
Max. buying power to minimize
cost of goods purchased
ROCE
Max. sales/sq. foot through:
*location
*product mix
*customer service *quality control
Sales/Capital
Employed
Max. inventory turnover through
electronic data interchange, close
vendor relationships, fast delivery
Minimize capital deployment
through outsourcing & leasing
© 2019 Robert M. Grant
www.contemporarystrategyanalysis.com
INDUSTRY ANALYSIS: THE FUNDAMENTALS
Summary
From Environmental Analysis to Industry Analysis:
•
The industry is the core of a firm’s external environment. Political, economic,
social, and technological forces impact the firm through its industry
:
Forecasting Industry Profitability
•
•
Past profitability a poor indicator of future profitability.
If we can forecast changes in industry structure we can predict likely impact
on competition and profitability.
Strategies to Improve Industry Profitability
•
•
Influencing industry structure by individual or collective strategies
Positioning the firm to shelter from the forces of competition
Defining Industry Boundaries
•
Key criterion: substitution
•
Industry definition depends upon the strategic issues being considered
Key Success Factors
•
Gateway to the analysis of competitive advantage
Copyright (© 2019 John Wiley & Sons, Inc.
CONTEMPORARY STRATEGY ANALYSIS
tenth edition
Robert M. Grant
John Wiley & Sons Ltd., 2019
Chapter 4
Further Topics in Industry
and Competitive Analysis
1
Further Topics in Industry and
Competitive Analysis
OUTLINE
? Objectives
? The limits of industry analysis
o Does Industry Matter?
o Hypercompetition
o Winner-Take-All Industries
? Beyond the Five-Forces
o Complements
o Ecosystems
o Business Models
? Competitive Interaction
o Game Theory
o Competitor Analysis
? Segmentation and strategic groups
Copyright © 2019 John Wiley & Sons, Inc.
FURTHER TOPICS IN INDUSTRY AND COMPETITIVE ANALYSIS
Objectives
? To recognize the limits of the Porter five forces
framework, and extend the framework to include the role
of complements as well as substitutes
? To acknowledge competition as a dynamic process, to
appreciate the insights that game theory offers into the
dynamics of rivalry, and to use competitor analysis to
predict competitive moves by rivals
? To segment an industry into its constituent markets,
appraise the relative attractiveness of different segments
and apply strategic group analysis to classify firms
according to their strategic types
© 2016 Robert M. Grant, www.contemporarystrategyanalysis.com
THE LIMITS OF INDUSTRY ANALYSIS
Does Industry Matter?
Copyright © 2019 John Wiley & Sons, Inc.
LIMITS OF INDUSTRY ANALYSIS
Competition as a Dynamic Process:
Hypercompetition
Porter framework assumes:
(a)
(b)
industry structure drives competitive behavior
Industry structure is (fairly) stable.
But, competition also changes industry structure:
•
Schumpeterian Competition: A “perennial gale of creative destruction”
–market leaders overthrown by innovation
•
Hypercompetition: “intense and rapid competitive moves….
continuously creating new competitive advantages and destroying
existing competitive advantages”
Implication: –Within 5-forces framework:
INDUSTRY STRUCTURE
COMPETITION
–Under dynamic competition:
COMPETITIVE STRATEGY
Copyright © 2019 John Wiley & Sons, Inc.
INDUSTRY STRUCTURE
LIMITS OF INDUSTRY ANALYSIS
Winner-Take-All Industries
? In some industries, the notion of “industry attractiveness” is
meaningless because one firm takes all the industry’s profits
and other firms earn little or no profit
? These “winner-take-all” industries tend to be those with
extreme scale economies (e.g. search engines) or network
externalities (online auction sites, social networks)
Copyright © 2019 John Wiley & Sons, Inc.
BEYOND THE 5-FORCES
Five Forces or Six?
Introducing Complements
SUPPLIERS
Bargaining power of suppliers
The suppliers of
complements create
value for the industry
and can exercise
bargaining power
INDUSTRY
COMPETITORS
POTENTIAL
ENTRANTS
COMPLEMENTS
Threat of
new entrants
Threat of
Rivalry among
existing firms
Bargaining power of buyers
BUYERS
© 2019 Robert M. Grant,
www.contemporarystrategyanalysis.com
SUBSTITUTES
substitutes
BEYOND THE 5-FORCES
Business Ecosystems:
Managing Value Migration
? A business ecosystem is the “community of organizations,
institutions, and individuals that impact the enterprise”
? Change within a business ecosystem causes value to
migrate between firms and groups of firms
? A firm can influence value migration within a business
ecosystem in order to increase its share of value within the
system. E.g. by becoming a “guardian of quality”, becoming
irreplaceable, exploiting changing customer needs, or
reconfiguring the value chain.
Copyright © 2019 John Wiley & Sons, Inc.
BEYOND THE 5-FORCES
Using Business Models to Manage the Ecosystem
? A business model is a simplified description of a business that specifies
the core logic for creating value
? Business models are useful for developing strategies that can exploit the
opportunities available in complex business ecosystems
? The Business Model Canvas is a graphical tool for designing business
models:
Infrastructure
Partners
Offer
Activities
Resources
Customer
Segments
Value
Proposition
Channels
Financial viability
Costs
Profit
Relationships
Revenues
THE BUSINESS
MODEL CANVAS
COMPETITIVE INTERACTION
The Contribution of Game Theory
to Competitive Analysis
1. Frames strategic decisions as interactions between competitors
2. Predicts outcomes of competitive situations involving a few,
evenly-matched players
3. Provides key insights into the nature and determinants of interactions
among competitors. E.g.:
a)Competition and Cooperation—Game theory can show conditions
where cooperation more advantageous than competition
b)Deterrence—changing the payoffs in the game in order to deter
a competitor from certain actions
c)Commitment—irrevocable deployments of resources that
give creditability to threats
d)Signaling—communication to influence a competitor’s decision
Problems of game theory:
•
•
Able to explain past competitive behavior—weak in predicting future behavior.
Lack of an integrated general theory— Many different models; outcomes highly
sensitive to small changes in assumptions
© 2016 Robert M. Grant, www.contemporarystrategyanalysis.com
COMPETITIVE INTERACTION
A Framework for Competitor Analysis
OBJECTIVES
What are competitor’s current goals?
Is performance meeting there goals?
How are its goals likely to change?
PREDICTIONS
STRATEGY
How is the firm competing?
ASSUMPTIONS
What assumptions does the competitor
hold about the industry and itself?
RESOURCES & CAPABILITIES
What are the competitors’ key
strengths and weaknesses?
© 2016 Robert M. Grant, www.contemporarystrategyanalysis.com
• What strategy changes
will the competitor
initiate?
• How will the competitor
respond to our strategic
initiatives?
SEGMENTATION AND STRATEGIC GROUPS
Segmentation Analysis: The Principal Stages
Identify segmentation variables
Reduce to 2 or 3 variables
Identify discrete categories for
each variable
1.
Identify key variables
and categories
2.
Construct a segmentation matrix
3.
Analyze segment attractiveness
4.
Identify KSFs in each segment
Potential for economies
of scope across segments
5.
Analyze benefits of
broad vs. narrow scope
Similarity of KSFs
Copyright © 2019 John Wiley & Sons, Inc.
Differentiation benefits of
segment focus
SEGMENTATION AND STRATEGIC GROUPS
Customer and Product Characteristics
as Segmentation Variables
•Size
Characteristics
of the Buyers
Industrial buyers
•Technical
sophistication
•OEM/replacement
Household buyers
•Demographics
•Lifestyle
•Purchase occasion
Distribution channel
Opportunities for
Differentiation
Characteristics
of the Product
Copyright © 2019 John Wiley & Sons, Inc.
Geographical
location
•Size
•Distributor/broker
•Exclusive/
nonexclusive
•General/specialist
• Size
• Price
• Features
•Technology/design
• Inputs used (e.g. raw materials)
• Performance characteristics
•Pre-sales/after-sales services
SEGMENTATION AND STRATEGIC GROUPS
Segmenting the World Automobile Market
R E G I O N S
North
Latin
W.
America America Europe
Luxury cars
Large/midsize sedans
P
R
O
D
U
C
T
S
Compact family cars
Mini cars
Sports cars
SUVs
Multi-purpose vehicles
Pickup trucks
Hybrid cars
Electric cars
Copyright © 2019 John Wiley & Sons, Inc.
E.
Europe
East
Asia
South
Asia
Pacific Africa/Mid
-dle East
SEGMENTATION AND STRATEGIC GROUPS
Vertical Segmentation & Industry
Profit Pools: The US Auto Sector
25
20
Service & repair
Leasing
15
Warranty
Auto
Auto
manufacturing
loans
New car
dealers
Used car dealers
10
5
0
0
Copyright © 2019 John Wiley & Sons, Inc.
Gasoline
Auto
insurance
Share of industry revenue (%)
Aftermarket
parts Auto
rental
100
SEGMENTATION AND STRATEGIC GROUPS
Vertical Segmentation & Industry
Profit Pools: Electric Vehicles
Power
management
25
Power
generation
EBIT
/Sales
(%)
20
Servicing
& repair
Financing
15
10
5
Batteries
Vehicle production
Distribution
0
Revenue
Copyright © 2019 John Wiley & Sons, Inc.
Charging
points
Value added services
(e.g. entertainment,
navigation,
information)
SEGMENTATION AND STRATEGIC GROUPS
Segmentation and Key Success
Factors: The U.S. Bicycle Market
SEGMENT
Low price bicycles sold primarily
through department and discount
stores, mainly under the retailer’s
own brand (e.g. Sears’ “Free Spirit”);
Medium-priced bicycles sold mainly
under manufacturer’s brand and
distributed through specialist cycle
stores
KEY SUCCESS FACTORS
• Low-costs of components and assembly.
• Supply contract with major retailer.
Leading competitors: Assemblers in Taiwan & China
+ a few U.S manufacturers, e.g. Murray Ohio, Huffy
• Cost efficiency through scale and low wage costs
• Reputation for quality
• Good dealer relations
* International marketing & distribution.
Leading competitors: Giant, Peugeot, Fuji
High-priced bicycles for enthusiasts.
• Quality components and assembly
• Innovation in technology and design
• Reputation (including success in racing)
• Strong dealer relations.
Children’s bicycles /tricycles) sold
through discount stores, & toy stores)
Similar to low-price bicycle segment.
Copyright © 2019 John Wiley & Sons, Inc.
SEGMENTATION AND STRATEGIC GROUPS
Strategic Group Analysis
A strategic group is a group of firms in an industry
that follow the same or similar strategies
Identifying strategic groups:
• Identify principal strategic variables which
distinguish firms.
• Position each firm in relation to these
variables.
• Identify clusters.
Copyright © 2019 John Wiley & Sons, Inc.
SEGMENTATION AND STRATEGIC GROUPS
Strategic Groups within the World
Automobile Industry
Broad
PRODUCT
RANGE
Narrow
GLOBAL, BROAD-LINE
PRODUCERS
e.g., GM, Ford, Toyota,
Honda, VW, Renault-Nissan,
Fiat-Chrysler
,
NATIONAL PRODUCERS OF
INTERMEDIATE RANGE OF
MODELS
e.g. Tofas (Turkey), Proton
(Malaysia), Tata Motors (India),
Chery (China) , Avtovaz
(Russia)
NATIONALLY- FOCUSED,
SPECIALIST PRODUCERS e.g.,
Bristol (UK), BDY (China), Premier
(India), Classic Roadsters (US),
Morgan (UK),
National
Copyright © 2019 John Wiley & Sons, Inc.
GLOBAL PRODUCERS OF A
LIMITED RANGE OF
MODELS e.g., BMW,
Fuji/Subaru, Isuzu, Suzuki,
PERFORMANCE
CAR PRODUCERS
e.g., Ferrari (Italy),
Aston Martin (UK),
Tesla, Fisker (US)
GEOGRAPHICAL SCOPE
Global
SEGMENTATION AND STRATEGIC GROUPS
Strategic Groups within the World
Petroleum Industry
Upstream
NATIONAL
PRODUCTION
COMPANIES
INTERNATIONAL
EXPLORATION & PRODUCTION
COMPANIES
e.g. Saudi Aramco, Kuwait
Petroleum, Qatar
Petroleum,
Vertical
Balance
Integrated
INTEGRATED
NATIONAL OIL COMPANIES
e.g. Petrobras, PDVSA, CNPC,
Indian Oil, Pemex
e.g. Conoco, Apache, Occidental,
Marathon Oil
INTEGRATED
INTERNATIONAL
MAJORS
SUPER MAJORS
e.g. ExxonMobil, Shell,
BP, Chevron, Total,
e.g. Eni, Repsol,
PetroCanada
DOMESTIC-FOCUSED
DOWWNSTREAM
COMPANIES
Down
stream
e.g. Valero, Nippon Oil,
Neste
National
Global
Geographical Scope
Copyright © 2019 John Wiley & Sons, Inc.
FURTHER TOPICS IN INDUSTRY AND COMPETITIVE ANALYSIS
Summary
?
Conventional industry analysis is limited to the extent that:
a) Industry membership is a minor influence on firm profitability
b) It assumes industry structure is stable—the competitive process can
transform industry structures
c) In “winner-take-all” industries, the notion of industry attractiveness is
meaningless
? We can extend our analysis of industry and competition to take account of:
a) complementary products
b) platform-based competition
c) business ecosystems
?
Competitive interactions between close rivals can be analyzed:
a) game theory
b) competitor analysis—which is less formal than game theory, but can
help us to understand competitors and predict their behavior
?
Segmentation analysis and strategic group analysis allows us to
understand industries at a more detailed level
Copyright © 2019 John Wiley & Sons, Inc.

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