Presentation on theme: "Risk Management and Strategic Planning"— Presentation transcript:
1 Risk Management and Strategic Planning Unit 5The External Environment:Competition
2 ReadingBookChTribe, J, (2010) Strategy for Tourism, Goodfellow Publishers, Oxford.5Capon, C. (2008) Understanding Strategic Management, Prentice Hall: Hemel Hempstead.2Tribe, J. (2005) The Economics of Recreation, Leisure and Tourism, Butterworth Heinemann, Oxford.8Johnson, G., Scholes, K., and Whittington, R. (2008) Exploring Corporate Strategy, Prentice Hall: Hemel Hempstead.
3 Learning OutcomesAfter studying this chapter and related materials you should be able to understand:Porter’s five forcesand critically evaluate, explain and apply the above concepts
5 Discussion PointOn what basis do organisations compete with each other?What is competitive advantage?What is competitive risk?
6 The competitive environment In his book Competitive Strategy (1980), Porter proposes the following model (‘the five forces’) for investigating the competitive environment:1 the threat of entrants2 the power of suppliers3 the power of consumers4 the threat of substitutes5 competitive rivalry
8 The degree of competitive rivalry Competitive rivalry measures of the intensity of competition in an industry.It is is determined by the competitive conditions in the four forces analysed above and in addition:Degree of market leadership (dominant firm)Industry growth ratePerishability of productsMarginal costs of salesHigh exit costsCross subsidisation