Competitive Strategy: Techniques for Analyzing Industries & Competitors

Competitive Strategy: Techniques for Analyzing Industries & Competitors By Michael E Porter The Free Press, New York, 1980, Pages: 397, Price: $25.33 ISBN-10:0684841487; ISBN -13:978-0684841489Competitive Strategy - Techniques for Analyzing Industries and Competitors aims to provide a comprehensive and structured approach for strategy formulation by inviting readers to look into the profound impact of environmental forces in general, and of competitors in particular, on the success of businesses.OVERVIEW OF THE BOOKCompetitive Strategy - Techniques for Analyzing Industries and Competitors posits that organizational actions are externally controlled and constrained. Survival of the organization lies in creating a best fit between environment and resources of the organization. Hypothesis supports the idea that environmental factors play decisive role in putting up threats and opportunities for the organizations. In addition, structure of industry and environmental forces keep on evolving, thereby forcing organizations to consistently interact and respond according to the changing environmental conditions. However, organizations do not remain passive in this process, rather they can be proactive to understand and predict changes in industries. Porter, in this book, provides set of tools and techniques to make strategic choices among various options posed by environment.Porter is of the view that every firm competing in industry holds a competitive strategy. The process of formulation of strategy in an organization takes place in two ways:* Explicit strategy formulation that is based on the planning process; and* Implicit strategy formulation that is evolved as an outcome of organization's functional activities.Porter takes the position that it is always doubtful to have implicit process as source of best strategy; hence, he attributes the explicit process of strategy formulation as a best way of taking maximum benefits for the firm.FINDING THE COMPETITIVE ENVIRONMENTThe essence of the book is to provide a framework of relating a company to its environment. Framework encompasses a best fit between firm's resources and environment. The book has been written from two dimensions. On one end it highlights importance of understanding industry structure and developing in-lined strategies to deal with it. Another dimension of the book, which is rather more interesting and productive, is to propose frameworks and tools for industry analysis and crafting strategy. The book, thus, successfully asserts philosophical insights and provokes thinking of business pundits to look into industry dynamics with a different perspective on one hand, and proposes standardized generic tools for systematic analysis on the other.Accordingly the book is divided into three parts.First part encapsulates general analytical techniques for understanding environmental forces, dynamics of industry evolution and dimensions of competitive strategies.Included in Part II is the application of generic business strategies in various forms of industries, in line with structural determinants, sources and impediments of respective industrial segments/forms.Finally Part III establishes multiple options for a firm in its dealing with environmental forces. The book considers Vertical Integration, capacity expansion and entry into new business as available strategic decisions for the firms.SCANNING THE COMPETITIONCompetition has always been central to the managerial decisions. Rising intensity of competition has continued until present era. This book however presented new spheres of looking into competition. Contemporary writers raised important points in strategy formulation for coping with competitive forces of the industry. Porter has given a systematic and rigorous tool to answer to these questions. Porter also signaled a new direction and provided thought for economic models. …