Analysis Of Michael Porter’s Technique For a Competitive Analysis
Michael Porter’s technique for competitive analysis is determining whether an organization’s profitability is above or below the industry’s average. In the long run, the fundamental basis of above-average profitability is a sustainable competitive advantage. There are two basic types of competitive advantage an organization can possess, low cost or differentiation. It assesses the attractiveness of an identified geographic region for a product and or service category. Porter’s competitive analysis gives insight into a service category and area that provides competitive dynamics. It helps marketers and managers look at the balance of power in a market between global organizations and analyze the industry sector’s potential profitability.
Determine one factor for each of Porter’s five forces of an environmental analysis that would apply to a healthcare organization.
- Competitive Rivalry – Look at the number and strength of all your competitors. Questions like, How many rivals do you have? Who are they, and how does the quality of their products and services compare with yours? Will Where rivalry is intense, healthcare organizations can attract customers with aggressive price cuts and high-impact marketing campaigns.
- Supplier Power – is determined by how easy it is for your suppliers to increase their prices. The more you have to choose, the easier to switch to a cheaper alternative. But the fewer suppliers there are, and the more you need their help, the stronger their position and ability to charge you more. That can impact your
- Buyer Power – When dealing with only a few patients or customers, they have more power, but your power increases if you have many patients or customers. So you’ll have to ask yourself,” Would it cost a patient to switch from your products and services to those of a rival? Or even How many buyers are there, and how big are their orders?
- The threat of Substitution – refers to the likelihood of the patients and customers finding a different way of doing what you do at your job. For example, a substitution drug for pain that is easy and cheap to make and get can weaken your position and threaten your profitability.
- The threat of New Entry – If it takes little money and effort to enter the healthcare market and compete effectively, or if you have little protection for your main drugs and or even price, then rivals can quickly enter your market and weaken your position. If you have solid and durable entry barriers, you can preserve a favorable position and take fair advantage of it.
Compare and contrast the answers to a competitor of the pediatric healthcare organization you chose in the Week 2 research assignment.
I would have chosen Sandhills Pediatrics Northeast. Their competitor is Palmetto Pediatric & Adolescent Clinic. Sandhills now has telemedicine to protect parents and patients during this challenging pandemic. Its convenience of virtual visits with pediatricians makes it easier for both parties. The competition between both facilities is high because they are very good at meeting their patients’ needs. Still, I think Sandhill is a threat to Palmetto because there is much more traffic at Sandhill, and treatments and visits are lower but very effective.
Peer Post
Porter recognized that organizations likely keep a close watch on their rivals. Still, it’s like he encouraged them to look beyond the actions of their competitors and examine what other factors could impact the business environment. His five forces analysis is an essential tool for understanding the forces that shape competition within the industry. It’s also helpful in helping you to adjust your strategy to suit your competitive environment and to improve your potential profit.
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Question 
From readings in the textbook or peer-reviewed journal articles, analyze Michael Porter’s technique for competitive analysis.
Analysis of Michael Porter’s Technique For a Competitive Analysis
Determine one factor for each of Porter’s five forces of an environmental analysis that would apply to a healthcare organization.
Compare and contrast the answers to a competitor of the pediatric healthcare organization you chose in the Week 2 research assignment.