Explain Porter's Five Forces in HR Management

In this segment, you will now learn how to analyse the principal competitive forces acting on an industry.

Listen to our faculty Sandeep Nair explain Porter's Five Forces model. 

In this video, you learnt that the Porter’s Five Forces framework holds that the competitive pressures on companies within an industry come from five sources. They include the following:

1. Competitive rivalry

2. Threat of new entry

3. Threat of substitution

4. Supplier bargaining power

5. Customer bargaining power

However, you need to keep the following points in mind before using the Five Forces framework:

1. All five forces will not be equally applicable to all industries.

2. The five forces model is primarily backward-looking.

3. It should only be used as part of a holistic strategic assessment.