1. INDUSTRY ANALYSIS IV

2. Toolkit

Determinants ofindustry attractiveness

• #1. Economic Traits

• #2. Competitive Forces

• #3. Key Success Factors

• #4. Likely Moves by Rivals

3. #1 Dominant Economic Traits

Market Size

Scope of Competition

- LocalRegional

- NationalGlobal

Industry Growth Cycle

- EarlyTakeoff

- MatureStagnant

- Decline

4. Dominant Economic Traits

Prevalence of Backward and Forward Linkage

Pace of Technological Change

Learning Curve Effect

Capital Requirement

Profitability (above/below par)

5. #2Porters FiveForces Substitute Products (of firms in other industries) Suppliers of Key Inputs Buyers Potential New Entrants Rivalry Among Competing Sellers 6. #3. Key Success Factors

Technology:

• ProductInnovation Capability

Production ProcessInnovation Capability

Expertise in given technology

Manufacturing :

• • Scale economy

• • Experience curve effect

High Labour Productivity

Flexibility to manufacture a range of products

7. KSF

Distribution:

Low distribution cost

Company-owned retail outlets

Fast delivery

Marketing:

• Well-trained sales force

Dependable service and technical assistance

Attractive styling/packaging

8. KSF

Skills:

Quality control know how

Design expertise

Expertise in particular technology

Organization:

Superior Information System

Managerial know-how

Ability for quicker response to market

9. KSF

Others:

• Convenient Location

Courteous Employees

Patent Protection

10. #4. Likely Strategic Moves by Rivals

Strategic Intent:

Be dominant leader

Move into top 5

Maintain position

Market Objective:

Getting stronger, on the move

Well-entrenched, able to maintain position

All things to everybody

11. Moves by Rivals

Strategic Posture:

Mostly offensive

Mostly defensive

Aggressive risk taker

Competitive Strategy:

Striving for low cost leadership

Mostly focusing on market niche

Pursuing differentiation