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THE STRUCTURE ANALYSIS OF INDUSTRY

FIRM PERFORMANCE AND COMPETITIVE


ADVANTAGE

Yolanda Hartati Sianturi 041524253023


Ria Yanuari Pramono 041524253029
The Five-Forces Model of Competition
(Porter) Potential development
of substitute products

Bargaining power Rivalry among Bargaining power


of suppliers competing firms of consumers

Potential entry of new


competitors
The
The Structural
Structural Determinants
Determinants of
of Competition
Competition
SUPPLIER POWER
Supplier concentration
Relative bargaining
power

THREAT OF ENTRY INDUSTRY RIVALRY SUBSTITUTE


Capital requirements Concentration COMPETITION
Economies of scale Diversity of
Absolute cost advantage competitors Buyers propensity
Product differentiation to substitute
Product differentiation
Relative prices &
Access to distribution Excess capacity &
channels exit barriers performance of
substitutes
Legal/ regulatory barriers

BUYER POWER
Buyers price sensitivity
Relative bargaining
power
STRATEGI GENERIK PORTER

KEUNGGULAN STRATEGI

T KEUNIKAN
A POSISI BIAYA
RENDAH YANG DILIHAT
R PELANGGAN
G
E
T INDUSTRI Cost Leadership Differentiation
LUAS Strategy Strategy
S
T
R
A
T HANYA PASAR FOCUS STRATEGY
E TTT.
G
I
Karakteristik Strategi Generik
Cost Leadership
Produce of the lowest costs
Deliver goods (or services) at the lowest
costs
Lowest cost is main focus and strategy
Differentiation
Strategy
Products/services differentiate themselves
from others
The Firm has unique resources and capabilities
Target Customer Segment is not price-sensitive
Customers have very specific needs

Focus Strategy
Tiny, Focused Group
Resiko Strategi Generik

Risks of Cost Risks of


Risks of Focus
Leadership Differentiation

Rentan imitasi Rentan imitasi Strategi ditiru


pesaing, perubahan pesaing Permintaan
teknologi berkurang/hilang

Kedekatan dgn Kedekatan dalam Pesaing


diferensiasi merupakan biaya merupakan menggangu
kerugian kerugian segmen yang
digarap

Pesaing fokus bisa Pesaing fokus bisa Pesaing fokus


lebih berbiaya rendah lebih baik buka sub
segmen baru
STUCK IN THE MIDDLE

The firm failing to develop its strategy, in at least one of


the three directions a firm that is stuck in the middle
is an extremely poor strategic situation

--Michael E Porter, 1980


GENERIC STRATEGIES/INDUSTRY
FORCES
These generic strategies each have attributes that can serve to defend against competitive
forces.
Generic Strategies
Industry
Cost
Force Differentiation Focus
Leadership

Entry Ability to cut price in Customer loyalty can Focusing develops core
retaliation deters discourage potential competencies that can
Barriers potential entrants. entrants. act as an entry barrier.

Large buyers have less Large buyers have less


Buyer Ability to offer lower price power to negotiate power to negotiate
Power to powerful buyers. because of few close
alternatives.
because of few
alternatives.

Suppliers have power


because of low volumes,
Supplier Better able to pass on
Better insulated from but a differentiation-
supplier price increases
Power powerful suppliers.
to customers.
focused firm is better
able to pass on supplier
price increases.

Customers become
Threat of Specialized products &
Use low price to defend attached to differentiating
core competency protect
Substitutes against substitutes. attributes, reducing threat
of substitutes.
against substitutes.

Rivals cannot meet


Better able to compete Brand loyalty to keep
Rivalry on price. customers from rivals.
differentiation-focused
customer needs.
STRATEGY AND COMPETITIVE
ADVANTAGE
GENERAL MODEL OF STRATEGIC
MANAGEMENT
Company Profile

Mission Objectives Strategies Tactics

Industry & Environmental


Analysis
MEASURING PERFORMANCE
ACCOUNTING MEASURES OF
COMPETITIVE ADVANTAGE
Activity Ratios
Inventory Turnover
AR Turnover
Average Collection Period
Profitability Ratios
ROA
ROE
EPS
THANKYOU!