Please provide an explanation of the following:

1. A brief summary of Michael Porter’s five forces model.
2. The value of using this model in the strategic planning process.
3. Conducting a five-force analysis on the chosen physician group practice.
4. Interpret the findings from the analysis.
5. Taking into consideration of the analysis findings; identification and description of the strategic planning implications.


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1. Summary of Michael Porter’s five forces model.

Michael Porter’s famous Five Forces of Competitive Position model is a simple perspective for assessing and analysing an organization’s competitive strength and its position in the market and among the competition. The model is an innovative way of thinking with the ability to represent complex concepts in relatively easily accessible formats. Additionally, the model can be used to analyse market factors so as to make a strategic assessment of the competitive position of a company, or supplier in a given market(Business balls, 2013). As it relates to the physician’s group, Porter’s Five Forces tool is a simple, yet useful one for understanding where the group’s power and getting the physicians to understand the strengths and weaknesses of their current competitive position and that of others in the industry. According to Porter, the five forces that drive competition are:
1. Existing competitive rivalry between suppliers
2. Threat of new entrants into the market
3. Bargaining power of buyers
4. Power of suppliers
5. Threat of substitute products (this includes technology change)(Businessballs, 2013).


Porter’s Five Forces Model can also be advantageous to many organizations, in order to achieve better analytical effect especially when used alongside other models such as The SWOT and PEST analysis (Businessballs, 2013). The simplistic identification examples of five generic descriptions of industries are:
 Fragmented: (eg, shoe repairs, gift shops)
 Emerging: (eg, space travel)
 Mature: (eg, automotive)
 Declining: (eg, solid fuels)
 Global :(eg, micro-processors)(Businessballs, 2013).
Additionally, according to Porter, the following is needed in assessing relative competitive strength of nations, and the implication of their industries:
 Factor Conditions: These are those production factors that are required for a given industry-such as skilled labor, logistics and infrastructure.
 Demand Conditions: Entails the extent and nature of demand within the market or nation concerned for the product or service.
 Related Industries: Include the existence, extent and competitive strength of other competing industries in the industry or even on a National scale that support or assist the industry in question.
 Corporate Strategy, Structure and Rivalry: This include the conditions in the home market that affect how corporations are created, managed and grown. The logic or idea here, is that firms that have to fight hard in their home markets are more likely to be able to succeed in international markets(Businessballs, 2013).

2. The value of using Porter’s model in the strategic planning process

As this specifically relates to the physician’s practice group, it is advantageous for the group to incorporate Porter’s model in their strategic planning process, so as to help facilitate and maintain its substantial patient base which is the lifeline of sustaining success in private practices(Jong, 2009). To do so in the present environment, the group’s practice will need to build up its core competence, particularly through physician’s alignment and capabilities and the practice’s network-ability(Jong, …

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