What forces drive competition in an industry? What moves will competitors make? How will one's industry evolve? How do strategic planners respond to competitive actions? How can a firm be best positioned to compete in the long run?
Michael Porter's Competitive Strategy is the definitive work on the subject of "competitive strategy," the hottest new concept in American business today. The book addresses major questions of vital concern to managers, and presents a comprehensive set of analytical techniques for understanding a business and the behavior of its competitors.
Step-by-step, Porter provides the techniques and tools managers need to successfully conduct an industry and competitor analysis. Just a few examples:
- The fundamental factors determining the nature of competition in a business.
- The three generic competitive strategies for coping with industry structure: cost leadership, differentiation, and "focus."
- How to recognize and act on "market signals" from competitors.
- Forecasting how the structure of an industry will evolve.
- The costs, risks, and returns of a "preemptive" strategy.
- Competing effectively in an emerging industry.
- Selecting new industries to enter.
Beginning with a comprehensive set of tools and techniques for analyzing any industry and any array of competitors, the book moves on to examine competitive strategies for fragmented industries, emerging industries, maturing industries, declining industries and global industries. The final section of the book provides analytical techniques for making the important strategic decisions that confront firms -- vertical integration, major capacity expansion, divestment and entry into new businesses.
This book will enable managers to anticipate and prepare for -- rather than simply react to -- sudden competitor moves, new entries into their business, and shifts in industry structure, as well as to take forceful positive action to improve a company's position through tested competitive strategies. Competitive Strategy is destined to become the Bible for Fortune 500 managers, company advisers, and securities analysts.
Michael E. Porter, Professor at the Harvard Business School, is the recipient of the 1979 McKinsey Foundation Award for The Best Harvard Business Review Article, and a guest columnist for The Wall Street Journal Professor Porter developed the widely acclaimed MBA course on Industry and Competitive Analysis, lectures widely on competitive strategy and is a consultant to numerous companies in the United States and abroad.
INTRODUCTION
PART I General Analytical Techniques
CHAPTER 1 THE STRUCTURAL ANALYSIS OF INDUSTRIES
Structural Determinants of the Intensity of Competition
Structural Analysis and Competitive Strategy
Structural Analysis and Industry Definition
CHAPTER 2 GENERIC COMPETITIVE STRATEGIES
Three Generic Strategies
Stuck in the Middle
Risks of the Generic Strategies
CHAPTER 3 A FRAMEWORK FOR COMPETITOR ANALYSIS
The Components of Competitor Analysis
Putting the Four Components Together -- The Competitor Response Profile
Competitor Analysis and Industry Forecasting
The Need for a Competitor Intelligence System
CHAPTER 4 MARKET SIGNALS
Types of Market Signals
The Use of History in Identifying Signals
Can Attention to Market Signals Be a Distraction?
CHAPTER 5 COMPETITIVE MOVES
Industry Instability: The Likelihood of Competitive Warfare
Competitive Moves
Commitment
Focal Points
A Note on Information and Secrecy
CHAPTER 6 STRATEGY TOWARD BUYERS AND SUPPLIERS
Buyer Selection
Purchasing Strategy
CHAPTER 7 STRUCTURAL ANALYSIS WITHIN INDUSTRIES
Dimensions of Competitive Strategy
Strategic Groups
Strategic Groups and a Firm's Profitability
Implications for Formulation of Strategy
The Strategic Group Map as an Analytical Tool
CHAPTER 8 INDUSTRY EVOLUTION
Basic Concepts in Industry Evolution
Evolutionary Processes
Key Relationships in Industry Evolution
PART II Generic Industry Environments
CHAPTER 9 COMPETITIVE STRATEGY IN FRAGMENTED INDUSTRIES
What Makes an Industry Fragmented?
Overcoming Fragmentation
Coping with Fragmentation
Potential Strategic Traps
Formulating Strategy
CHAPTER 10 COMPETITIVE STRATEGY IN EMERGING INDUSTRIES
The Structural Environment
Problems Constraining Industry Development
Early and Late Markets
Strategic Choices
Techniques for Forecasting
Which Emerging Industries to Enter
CHAPTER 11 THE TRANSITION TO INDUSTRY MATURITY
Industry Change during Transition
Some Strategic Implications of Transition
Strategic Pitfalls in Transition
Organizational Implications of Maturity
Industry Transition and the General Manager
CHAPTER 12 COMPETITIVE STRATEGY IN DECLINING INDUSTRIES
Structural Determinants of Competition in Decline
Strategic Alternatives in Decline
Choosing a Strategy for Decline
Pitfalls in Decline
Preparing for Decline
CHAPTER 13 COMPETITION IN GLOBAL INDUSTRIES
Sources and Impediments to Global Competition
Evolution to Global Industries
Competition in Global Industries
Strategic Alternatives in Global Industries
Trends Affecting Global Competition
PART III Strategic Decisions
CHAPTER 14 THE STRATEGIC ANALYSIS OF VERTICAL INTEGRATION
Strategic Benefits and Costs of Vertical Integration
Particular Strategic Issues in Forward Integration
Particular Strategic Issues in Backward Integration
Long-Term Contracts and the Economics of Information
Illusions in Vertical Integration Decisions
CHAPTER 15 CAPACITY EXPANSION
Elements of the Capacity Expansion Decision
Causes of Overbuilding Capacity
Preemptive Strategies
CHAPTER 16 ENTRY INTO NEW BUSINESSES
Entry through Internal Development
Entry through Acquisition
Sequenced Entry
APPENDIX A PORTFOLIO TECHNIQUES IN COMPETITOR ANALYSIS
APPENDIX B HOW TO CONDUCT AN INDUSTRY ANALYSIS
Bibliography
Index