Contemporary strategy analysis free essay sample

2001-2011 was filled with many black swan events (i. e. events that are extremely rare, have a major impact and are unpredicted even if they are rationalised retrospectively) e. g. Sep 11 attack, Lehman Brother collapse, Greece/Iceland bailouts, Arab Spring revolutions, major earthquakes and tsunamis) Rise of BRIC countries creating a multipolar world 2. Sluggish Economic Growth + Increased Competition Economic growth in advanced economies sluggish throughout the medium term governments and household sectors are over-leveraged insufficient productive investment from companies sitting on cash excess capacity in most sectors - resulting in strong price competition Internationalisation of companies from emerging-market countries e. g. contract manufacturers (OEM) in China and India competing with their customers in final markets. 3. Technology Disruption Digital technology disrupting incumbents (e. g. Netflix replacing Blockbuster) and redrawing industry barriers (e. g. Apple, Nokia, Nintendo, Blackberry now competing in same mobile device market) 4. Social Pressure and Crisis of Capitalism Loss of social legitimacy of companies as a result of a fall-out from the 2008/9 financial crisis – disdain for companies (hypocrisy + greed of bankers, traders, etc) and their leaders (e. 2 * Porters Five Forces Figure 3. 2 p. 69 + 3. 3 s. 70 * Suppliers * Same as in buyers box * Substitutes * Buyer propensity to subtitutes * Relative pries and performance of substitutes * Buyers * Price sensititity Cost of product relative to total cost * Product differentiation * Competition between buyers * Bargaining power * Size and concentration of buyers relative to producers * Buyers switching costs * Buyers information * Buers ability to backward integrate * Potential entrants * Capital requirements * Economic of scale * Absolute cost advantages * Product differentiation * Acces to distribution channels * Gorvernment and legal barriers * Retaliation by established producers Analyzing industry attractiveness Applying Industry Analysis