Q: Explain the framework for competitor analysis.-05 / develop a framework for competitor analysis and discuss how it helps a firm to develop a competitor profile.-05
Competitor Analysis Framework
Michael Porter presented a framework for analyzing competitors based on the following four key aspects of a competitor, depicted in the diagram. Objectives and assumptions are what drive the competitor, and strategy and capabilities are what the competitor is doing or is capable of doing.
Competitor Analysis Components
|What drives the competitor | |[pic] | |[pic] | | What the competitor is doing | |or is capable of doing | |[pic] | | | |Future goals | |[pic][pic] | |[pic] | |[pic] | |Strategy | |[pic][pic] | |[pic] | | | |Competitor Response Profile | |1.satisfaction with current position | |2.likely moves or strategy | |3.where competitor vulnerable | |4.what provokes effective retaliation | | | | | | | |[pic][pic] | |Assumptions | |[pic] | |[pic][pic] | |Resources | |& Capabilities | | | | | | |
Understanding these four components will allow an informed prediction of the competitor response profile, as articulated in the key question posted in the above diagram.
Competitor's future goals:
Knowledge of goals will allow predictions about whether or not each competitor is satisfied with its present position and financial results and hence...