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Liyth Alhamzah
Sultanate of Oman
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Porter's 5 Forces Framework in Non-competitive Situations?
🔥 Hi, what part of Porter's five forces framework is inappropriate for non-competitive situations?
I appreciate your help. Thanks.
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Jaap de Jonge
Editor, Netherlands
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5 Forces is not for Non-competitive Situations Hi Liyth, any model (as used in science) is based on assumptions (premises). These typically limit the applicability of the model; they determine the boundaries of its usage.
The 5 forces model by Porter is no exception to the above, and is based on assumptions, including:
- The goal of a business is long-term profitability.
- All industries are based on competition
- The intensity of competition in an industry is rooted in an industry's economic structure which is determined by Porter's 5 forces.
The above does not mean that there is no world possible outside of the boundaries.
It does however mean that if you'd like to explore industries/situations outside of these assumptions you should not use Porter's model.
Here you can find more on the assumptions behind the 5 forces model.
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Liyth Alhamzah
Sultanate of Oman
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Non-competitive Benchmarking OK, Thank you for the reply. Since all industries are based on competition, the question might refer to non-competitive benchmarking. Thanks again.
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Jaap de Jonge
Editor, Netherlands
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Benchmarking in Non-competitive Situations Note that Porter claims that all industries (or even the whole world) are/is based on competition. This may not always necessarily be the case! See: here.
For more information on various types of benchmarking, including generic and collaborative benchmarking, take a look in our Benchmarking knowledge center.
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