Product Description

Electrifying in its simplicity - like all great breakthroughs - COMPETITIVE STRATEGY captures the complexity of industry competition in five underlying forces. Author Michael Porter introduces one of the most powerful competitive tools yet developed: his three generic strategies - lowest cost, differentiation, and focus - which bring structure to the task of strategic positioning. He shows how competitive advantage can be defined in terms of relative cost and relative prices, thus linking it directly to profitability, and presents a whole new perspective on how profit is created and divided. More than a million managers in both large and small companies, investment analysts, consultants, students, and scholars throughout the world have internalised Porter's ideas and applied them to assess industries, understand competitors and choose competitive positions. COMPETITIVE STRATEGY has filled a void in management thinking. It provides an enduring foundation and grounding point on which all subsequent work can be built. Porter's rich frameworks and deep insights comprise a sophisticated view of competition unsurpassed in the last quarter-century.

Product Details

• Amazon Sales Rank: #22451 in Books
• Published on: 2004-01-19
• Original language: English
• Binding: Paperback
• 416 pages

About the Author
Michael E. Porter, one of the world's leading authorities on competitive strategy and international competitiveness, is Professor of Business Administration at the Harvard Business School. He is the author of fourteen books, among them COMPETITIVE STRATEGY, THE COMPETITIVE ADVANTAGE OF NATIONS, and CASES IN COMPETITIVE STRATEGY.

Customer Reviews

Starting point for business strategy
Michael Porter is a Harvard Business School professor and a leading authority on competition and strategy. This book is a landmark in the field of strategy/strategic management, which later has become known as the positioning school. The book provides a great framework.

The book consists of three parts - General Analytical Techniques, Generic Industry Environments, and Strategic Decisions. In addition, the two appendices - Portfolio Techniques in Competitor Analysis, and How to Conduct an Industry Analysis - should also be mentioned as they are very useful.

In Part I, Porter discussess the structural analysis of industries (with the world-famous five forces), the three generic competitive strategies (overall cost leadership, focus, and differentiation), an excellent framework for competitor analysis, competitive moves, strategy toward buyers and suppliers, structural analysis within industries (strategic groups, strategic mapping, mobility barriers), and industry evolution (life cycle, evolutionary processes).

In Part II, Porter discusses competitive strategy within various generic industry environments, such as fragmented industries (with no real market leader), emerging industries (e-commerce and Internet are excellent examples, although not mentioned in this book as it was written in 1980), mature industries, declining industries, and global industries.

In Part III, Porter discusses strategic decisions which businesses/firms can take, such as vertical integration (forward, backward, partnerships), capacity expansion, and entry into new industries/businesses.

Even after 20 years, most of this book still stands strong, although some people will argue this. It is a MUST for MBA-students and all other people interested in strategy/strategic management. The book is good to read (simple US-English) and thus does not become a struggle.

How Important Are Competitors in Setting Future Strategy?
Anyone would agree that this book is the best overview of competitive strategy analysis ever written. The strength of the book is a solid outline of subjects and questions to improve your thinking, and get to be a step ahead of the competition. In highly-competitive, commodity businesses, that's usually what strategies focus on.

On the other hand, the rapid advances of knowledge and technology mean that the relevant benchmark is perfection, not the competitor, in defining an ideal best practice. In that world, this book has serious limitations, because the competitive dimension is often less important than the customer and user dimension these days.

Any business arena begins, as Peter Drucker so aptly put it, with the task "to create a customer." That reminder is especially relevant today when they are so many new ways to serve a customer's needs that no one has ever considered before. The strategic point of 'Blown to Bits' for example is that almost every business will see its vertical value chain (moving from resources through to the customer) broken apart into tiny segments each served by specialists. If you did not begin with that perspective in analyzing the impact of electronically-based business practices, you could easily focus on the wrong tasks using this book to create an over-broad strategy focus, rather than concentrating on just a few areas.

I suspect that the applications of Moore's Law and Metcalfe's Law need to be explicitly considered as part of the analysis that Professor Porter is recommending.

A more general weakness in this book is that it assumes that future conditions will be stable enough to draw conclusions about which conditions will be favorable, without giving enough guidance on how to deal with the increasing frequencies and degrees of volatility that we see (in areas like financial markets, commodity prices, the weather, changing customer preferences, and so forth).

Although no book that takes such a narrow focus can help but have weaknesses (like having the podiatrist not notice that you have kidney problems), if you want a good start of how to think about competitors, this is the book for you. Just be sure you keep developing yours strategy with additional dimensions after you finish using this analysis.

If you have read none of Professor Porter's works, this is the one book you should read.

Starting point for business strategy
Michael E. Porter is a Harvard Business School professor and a leading authority on competition and strategy. This book is a landmark in the field of strategy/strategic management, and Porter's view has later become known as the positioning school. The book provides a great framework.

The book consists of three parts - General Analytical Techniques, Generic Industry Environments, and Strategic Decisions. In addition, the two appendices - Portfolio Techniques in Competitor Analysis, and How to Conduct an Industry Analysis - should also be mentioned as they are very useful.

In Part I, Porter discussess the structural analysis of industries (with the world-famous five forces), the three generic competitive strategies (overall cost leadership, focus, and differentiation), an excellent framework for competitor analysis, competitive moves, strategy toward buyers and suppliers, structural analysis within industries (strategic groups, strategic mapping, mobility barriers), and industry evolution (life cycle, evolutionary processes).

In Part II, Porter discusses competitive strategy within various generic industry environments, such as fragmented industries (with no real market leader), emerging industries (e-commerce and Internet are excellent examples, although not mentioned in this book as it was written in 1980), mature industries, declining industries, and global industries.

In Part III, Porter discusses strategic decisions which businesses/firms can take, such as vertical integration (forward, backward, partnerships), capacity expansion, and entry into new industries/businesses.

Even after 20 years, most of this book still stands strong, although some people will argue this. It is a MUST for MBA-students and all other people interested in strategy/strategic management. The book is good to read (simple US-English) and thus does not become a struggle.