Porter’s Five Forces Model – How To Understand the Competitive Landscape
In this installment of the Viral Octopus knowledge series, we are going to talk about a powerful business management theory for understanding the competitive environment that a particular business faces. Michael Porter developed his theory of Porter’s “Five Forces” analysis at Harvard Business School and published it in 1979. Since then it has exploded in popularity to become one of the most used fundamental perspectives for business analysis. What are Porter’s Five Forces? The number and strength of competitors that a company faces, the potential for new competitors to enter the market, the state of supplier relationships, customer relationships, and the possible impact of substitute products are all important forces to consider when analyzing a company’s potential strategic options and possible threats to profits.