Applying the Five Forces of Competition

Essentially, Porter’s five forces affect my company’s financial strategy for being competitive in the marketplace by summing up its principal concerns. What Porter has done by elucidating the five forces which shape industry competition is to outline the main themes one’s financial strategy must be prepared to address. By denoting exactly what these forces are, Porter has provided a baseline of prudent concerns with which to shape my organization’s financial strategy around.

His efforts have prepared us for the coming challenges of both today and tomorrow in this regard. Specifically, in order to maintain competitiveness my organization needs to focus on the correlation between the central challenge, rivalry among competitors, and the threat of new entrants. In the publishing field for information technology, there is always the reality that a new publication can emerge and provide similar content which could potentially detract from the revenues our organization earns. Naturally, those novice organizations swiftly become existing competitors.

What this concern and the others mean for my organization is that our business model must be willing to adapt. The cardinal point of Porter’s five forces is that what has worked for a business today might not necessarily do so tomorrow because of the effects of buyers (or readers, in our case), suppliers, substitute products and services, and existing rivalries.

Thus, our financial strategy is affected by those forces by pushing us to exploit our current business approach of educating the market regarding IT methods, while vigilantly monitoring the competitive landscape for additional revenue streams. Those same five forces affect my projections and ideas for business opportunities in a number of concrete ways. One of the most important concepts to consider for maintaining the sort of mutability required to contend with Porter’s forces is diversification.

Currently, my organization hosts a number of conferences each year which supplements the advertising revenue from our web site. However, we must continue to identify and leverage additional revenue streams. One of the most readily available is to sponsor virtual conferences in the form of webinars. The businesses to which we market—and many of which frequently patronize our conferences—would likely be willing to pay for the additional exposure of webinars regarding their products and services.