In this
part of the course, we are going to introduce external analysis guides
us through the definition and practice of strategy.
SECTORIAL
ANALYSIS
Through
external analysis, we are going to see how the environment effects
how a company functions with regards to opportunities to increase
profits.
Through
carrying out sectorial analysis we are trying to:
- Know
a company's sector structure, as this will influence the competition
and profitability.
- Know
the relationship that exists between the intensity of the competiton
and the company's profitability. Profits will be lower the
greater the competition.
- Anticipation
with regards to the sector's trends. The company needs to be
more dynamic than itscompetitors. A company should try and take advantage
of trends. For example, the demographic change in some countries means
an increase in elderly people. In this case, there are multiple business
opportunities focusing on the elderly.
- Value
common actions within a sector in the search of a global improvement.
- Find
business opportunities with regards to the clients needs and
the weaknesses of the competition. A company has to try and find gaps
in the sector. Which part of the market is not well attended by the
competitors? Can we with our resources give a better service?
