Sunday, February 14, 2016
Week 6 Reading Reflection
I thought this article was the most interesting reading we have done yet. I was intrigued to read about how profitability is the most important factor in competition of businesses. The size or intensity of the business and the product is less important, the key is how profit the business or industry is. For example, soft drinks or toilet paper could be a more profitable business than an airline company. Even if the product or service is intense, like in the restaurant industry or the airline industry; the profit margins could still be very slim, because there are many substitutes and high costs of supplies. It was a bit confusing to hear about how some products can be considered substitutes or considered competition to a firm, even if it is a very different product or service. It's interesting how one type of product can effect another's sales, even if they don't seem closely related. I would ask the author how connected these 5 forces that shape strategy are. I would want him to go into detail about how they effect each other and how forces can be considered as more than one. Also are there any other forces that are almost as important than the top 5? I do not think the author was wrong about anything in the article, I was just interested to read how some businesses can effect others who are distantly related, and how businesses can be more profitable with small, unsubstantial products, than companies with very important and highly respected services.
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Week 6
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