Competing Values Framework Video

Competing Values Framework Video
Competing Values Framework Video

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Competing Values Framework video

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Watch the Competing Values Framework video

DeGraf, J. (January 29, 2012). Competing values framework introduction. Available at: (about 8 mins long)

Identify what quadrant you think you are (be honest), then identify your balancing quadrant. Describe how you contribute (as this quadrant) to the healthcare setting you are currently employed in or your future healthcare setting once you complete school. Reflect on how your quadrant and its balancing quadrant contribute to the framework as a whole.

Consider the health system problems and reforms about which you have been reading. Can some organizational cultures respond to some of the problems better than others? What about the reforms?

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Product Innovation and Management

Product Innovation and Management
Product Innovation and Management

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Product Innovation and Management

Product and target market

In this report, we have three classes of products for review: telecommunication services, phone devices, and accessories. Each of these broad product categories has its own characteristics and individual trends within each age group and target market. The target demographic for these products is the baby boomers age group. The baby boomers demographic refer to the people born between the years 1945 and 1960.

This is a ready target market for such products since they have the disposable income to afford such commodities, they are present in social media, tech savvy, make purchases to improve their lives, they buy goods for both themselves and others, and are responsive to hipster advertising approaches (Patel, 2017). As such they are a perfect market for the products of choice and can conveniently respond to marketing and make purchases.

Markets – what does the competitive landscape for your product look like?

Main product segments

The main product segments for this analysis are telecommunications services, phone devices, and phone accessories. For further analysis, the focus of this report shall be the various features, competition, and trends in the three market segments identified above.

The main reason for this selection of these segments is that they have a great potential for growth in the target market of baby boomers (Deloitte Touche Tohmatsu Australia Ltd, 2014). In this regard, therefore, the expected growth, as well as the habits and characteristics of the baby boomers present a great combination for the product of telephone devices.

Product Innovation and Management

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The target market for the chosen products is baby boomers. It is among the most attractive consumer segments for the choice product of telephone devices. The demographics of the chosen market allow for the potential consumers to purchase the products often. For instance, baby boomers are known to love technology and they will invest in the products repeatedly (Deloitte Touche Tohmatsu Australia Ltd, 2014, p. 6).

Additionally, the baby boomers will invest in not only themselves but also others. The main beneficiaries of their investments are the generations X, Y, and Z, who are mainly their children and grandchildren through the gifting of mobile phones (Patel, 2017; Deloitte Touche Tohmatsu Australia Ltd, 2014, p. 7).

The trend in the telephone market in Australia has been one depicting a dwindling use of feature phones and telephone booths. The decline of such telephone devices has, however, resulted in the sharp increase in the uptake of smartphones (Market Line Advantage, 2017). Such trends have led to spectacular growth records, where the value of the mobile industry was at $3,405.9 million in 2016.

However, after the explosive growth over the past few years, the industry is expected to grow at a decreasing rate. Industry estimates place the growth rate at -1.9% for 2021 (Market Line Advantage, 2017). However, customer desires and expectations that directly target the baby boomers could shift this trend. A growth of features and innovations that the baby boomers find helpful could offshoot the expected decline in growth trend in a different direction.

Product Innovation and Management

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Major competitors and their products

Within the mobile smartphone and other related devices segment, there is a notion of an increased competition. However, trends and market data show that there are four major competitors in the mobile devices industry: Apple, Sony, Microsoft, and Samsung (Market Line Advantage, 2017). However, for the target market of baby boomers, they are more inclined towards the use of Samsung products as opposed to the preference for Apple phones as in the case for the millennials (Deloitte Touche Tohmatsu Australia Ltd, 2014).

Trends in the types of products being developed and launched

Trends in the phone devices segment. Over the years, trends in the mobile devices industry are coming together to prove a unified theme for the mobile devices in the industry. For the most part, for example, there is an increase in the screen size as well as the processing power and memory capacity of the mobile devices. As such, there is an increase in the efficiency of such devices across the market.

With the increase in efficiency, performance, and computing power of the smartphones, there is a trend to take over jobs previously held by other devices. The target market of baby boomers is identified as being responsive to products that make their lives easier (Deloitte Touche Tohmatsu Australia Ltd, 2014, pp. 8 – 9). As such, these trends of the developing devices should help in marketing the products to the target market.

Product Innovation and Management

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Trends in the telecommunication services segment

The telecommunications services segment of the industry is comprised of both the wireless and the fixed line telecommunications market. As such, the industry volume, operations, and trends are determined by the combination of subscribers to both the fixed line telephones and mobile telephone services (Market Line Advantage Australia, 2017). Various trends are observed in both the fixed line and wireless product variants, as well as in the telecommunications services industry segment.

Among the key trends includes the changeover between the two main products. In this regard, there is a noticeable change, where the number of subscribers to the fixed line telecommunications services has been dwindling over the years. Concurrently, the number of users subscribed to the wireless mobile networks have been increasing over the same period (Market Line Advantage Australia, 2017).

Another observable trend in the telecommunications services is the increase in the quality of services. Over the years, there has been a significant increase in the efficiency and capabilities of the telecommunications sector in the country and globe as well. The milestones achieved by the telecoms companies are mainly attributed to the growth in technology that supports their operations and service delivery to the increasing number of subscribers (el-Darwiche, Péladeau, Rupp, & Groene, 2017).

The growth in the service delivery is as a result of modernization of infrastructure and the improvement of technical skills among staff. In addition, the involvement of multiple firms in the business has increased the competition in the industry. As a result, the involved companies have to stay on top of their game to ensure they have a competitive edge over the other players.

Product Innovation and Management

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Looking into the future, experts place continued competition, and involvement in related industries as among the key trends to be observed in 2018 onwards. PWC Australia predicts the intensification of the competition by the telecoms companies operating in the country. In addition, there is supposed to be an improvement in the technology to enable better access to services such as a broadband network.

There is also an expectation to see the involvement in various sectors such as e-commerce and government to citizen services (PricewaterhouseCoopers Consulting (Australia) Pty Limited, 2018). Given these predicted trends, the telecommunications sector is expected to experience exponential growth in the foreseeable future, unlike the other comparable products and segments.

Trends in the phone accessories segment

The exponential growth of the mobile phone accessories market is directly related to the rise and growth of the usage of mobile phones. In this regard, most of the trends in the phone accessories are directly related to the growth in the mobile phone market, as well as the growth in technology. A case in point is the growth in the demand for quality headphones to accessorize the capability of modern smartphones as music players (Allied Market Research, 2016).

Such demand led to shifts in the manufacturing processes, where most mobile phone companies bundle earphones together with the phones. However, some consumers require more superior services to accessorize the music and instead purchase alternative headphones by more prominent companies with established products.

Product Innovation and Management

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Another mobile phone accessory case where  the trend is connected with the trends in the mobile telephone industry is the mobile phone cases industry. In the recent past, there have been numerous companies that have been established, whose sole concentration is on the research and development of mobile phone cases.

Such companies are using the latest technology in a bid to improve both the design and functionality of the cases (Allied Market Research, 2016; Market Line Advantage, 2017). In this regard, the business of the mobile phone cases is one that is expected to grow, either in tandem with the mobile phones or by a greater margin given the high demand for multiple smartphone cases by numerous individual users.


Allied Market Research. (2016, October 3). Mobile Phone Accessories Market to Reach $107.3 Billion by 2022, Globally. Retrieved from PR News Wire:—allied-market-research-595639141.html

Deloitte Touche Tohmatsu Australia Ltd. (2014). Mobile Consumer Survey 2014: The Australian Cut – Revolution and Evolution. Retrieved from Deloitte Australia Ltd:

el-Darwiche, B., Péladeau, P., Rupp, C., & Groene, F. (2017). 2017 Telecommunications Trends: Aspiring to digital simplicity and clarity in strategic identity. Retrieved from PWC Strategy&:

Market Line Advantage. (2017, March 28). Australia – Mobile Phones. Retrieved from Market Line Advantage:

Market Line Advantage Australia. (2017, July 19). MarketLine Industry Profile: Telecommunication Services in Australia. Retrieved from Market Line Advantage Australia:

Patel, N. (2017, April 26). Forget Millennials. 7 Reasons Why Baby Boomers Are the Ideal Target Market. Retrieved from Quick Sprout:

PricewaterhouseCoopers Consulting (Australia) Pty Limited. (2018, February). Five trends for Australian telecoms in 2018. Retrieved from PricewaterhouseCoopers Consulting (Australia) Pty Limited:

Product Innovation and Management

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New Product Development Process

New Product Development Process
New Product Development Process

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New Product Development Process

The main components of a New Product Development process and the benefits of using the Stage-Gate Product Innovation system in the New Product Development Process

New product development (NPD) is an important cornerstone to the success of any firm. To remain competitive, companies cannot bury their head and seem less concerned about developing new products that add value to their customers (Salgado, Salomon & Mello, 2012). Because of these, new product development process is important to businesses and the reason why companies should invest in it.  NPD ensures that a new product is introduced in the market to meet the needs of the customers. The paper critically evaluates main components of a NPD process as well as benefits of using Stage-Gate product innovation system.

Before a new product is introduced in the market, it has to go through different processes or stages. The major components of NPD include; opportunity identification and idea generation, product concept development, concept testing, design and engineering of products and lastly is the prototype development and testing (Hauser & Dahan, 2007).

Opportunity identification and idea generation is the first component of NPD process. This is a the most important component that kick-starts the process of development of a new product (Hauser & Dahan, 2007). The new product opportunities are identified or new ideas emerge based on the customer unmet needs. Customers are the major source of inspiration and therefore, any new idea generated must focus on meeting their needs. At this stage, it is important to embrace and consider the views or ideas of other stakeholders such as customers, suppliers, and employees’ point of view.

Communication of this view is expected in good time and no one should be left out (Salgado, Salomon & Mello, 2012). Some challenges may be experienced when gathering information from customers such as possibility of change of mind when the final product comes out,  difficult in forming opinions and expressing preference because  of a lack of sense of product features, and lastly biasness on the side of information gatherer due to biasness.

To avoid these, it requires use of appropriate methods of data collections for the target customers such as experiential interviews and user observation. In this age of technological advancement, use of web-based methods for the fuzzy front end can apply (Hauser & Dahan, 2007). Virtual groups participate on new product concept by providing their view and opinions. Many firms are finding such groups and individuals that browse on new product stimuli as rewarding.

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 The second component is product concept development that begins after identification and grouping of customer needs (Hauser & Dahan, 2007). The journey on how to address the needs of the customer commences. Not all ideas generated are considered. Nevertheless, some of these ideas at the start seem unconventional and impractical but are refined and share into viable opportunities (Salgado, Salomon & Mello, 2012).

Different ideation methods have been proposed. They include system approaches, forced relationships, incentive compatible ideation, brainstorming, varied perspectives, morphological analysis, and archival analysis. For instance, in brainstorming, members are at liberty to generate their ideas regardless whether they are good or unrealistic.

 The third component is concept testing. This is also a critical step in the process of new product development process. At this stage, the new products concepts are screened as potential customers use qualitative and quantitative research methods (Hauser & Dahan, 2007). During this process, it is also critical to carry out evaluations by asking oneself whether indeed the idea or concept is important to the consumer. Other attributes to evaluate are the purchase interest of the customers, dissatisfaction with the available products help to prioritize ideas for further testing, and funding.

The concept is defined in the form of a promise to the consumers that indeed the firm understands the relevant needs of the customers (Hauser & Dahan, 2007). It also provides a proof on how the company is prepared to address the needs of the consumers in a better way than any other (Hauser & Dahan, 2007). It is also important to provide an emotional or rational reason why the customer should try the company product, definition, and communication of the concepts core benefit proposition (CBP).

The concept is evaluated through laboratory test markets (LTMs) and survey research. The prediction need to be highly accurate for the product team to evaluate them and make improvement on them. At this stage, the setting  should be realistic and  concept of marketing such as consideration of marketing mix should be utilized  (Hauser & Dahan, 2007).

For example, advertisement of the concepts such as storyboards as opposed to finished advertising with prototype products should be used. Forecasting should be done as the concept moves through the process. This is because, resources are being utilized and it is important to have an estimate of the profit and revenue potential of the concept early in the process.

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The fourth component also stage is the designing and engineering products (Hauser & Dahan, 2007). This stage ensures that few but highly concepts that are proven viable are designed and engineered in order to meet the needs of the customers at profitable costs (Salgado, Salomon & Mello, 2012). The company cannot afford to design and engineer a concept if they have no value to the customer as well as to the company. The techniques they use to design and engineer products are value Engineering and conjoint analysis.

In conjoint analysis, the team optimizes the quantity or level of attributes or features that will be able to satisfy the customers and at the same time accrue profits to the company (Hauser & Dahan, 2007). For example, a company that produces marker cameras will be interested in knowing the optimal values of all the features that will go into its production such as the megapixel, the size, optimal zoom and the price of the camera when completed. In addition, they may also want to put to consideration situations where customers would make tradeoffs with other features.

Different methods of conjoint models are applicable such as hybrid, newer adaptive and discrete (Hauser & Dahan, 2007). On the other hand, value engineering is the integration of both the firm and customer perspectives when making cost and feasibility tradeoffs- in respect to the product (Hauser & Dahan, 2007). The team should consider the importance customers place on every function that the product performs in relation to the cost of the parts that are contributing to that function.

The underlying principle of value engineering is that the marginal cost of every part of the product need to not to exceed the marginal contribution to customer value. With advancement of new information and communication technologies web based methods for deigning and engineering product concepts have been embraced in most companies (Hauser & Dahan, 2007). Use of web based conjoint analysis is preferred because of the many benefits it offers such as capability to be demonstrated in a contextual manner.

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The last component is the prototype development and testing. The main aim or goal of this stage is evaluating the designed and engineered concepts to make the launch easier. At this stage, various prototypes are developed and then tested. The techniques used for testing automatically generate many solutions on the product concept theme (Hauser & Dahan, 2007).

Furthermore, at this stage, it is also important to test the marketing role by testing multiple designs with customers. Realistic testing is also required at this stage. The NPD team can simulate product acceptance in the marketplace that experiences or is affected by different variables such as sales force presentations, word of mouth, and advertising among other.

As globalization increases, the level of competition is increasing and this has seen decrease in product life cycles in most of the technology intensive industries ( Jou et al. 2010). This means that companies have to produce new products that will be of higher value to the customer to win over the competition. This therefore, forces innovators and thinkers to think about the most flexible ways to manage NPD without compromising on efficiency.

One of the methods of management NPD that companies are using is the Stage—gate processes. However, other avenues of adapting Agile methods for software development and integrating them with others are also underway. Little research on integration of the Agile and stage-gate processes has made it difficult for many companies to try the same because this may affect on their performance.

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 Stage-Gate product innovation systems are one of the methods that many industries rely on. This method is linear in nature and it depends on documentation on fixed set of activities (Sommer, Hedegaard, Dukovska-Popovska & Steger-Jensen, 2015). The method has a series of product development stages and it starts from the generation of idea, the development of the idea, and then implementation phases which is then followed with product launch or the evaluation stage that comes at the end.  

According to Sommer, Hedegaard, Dukovska-Popovska & Steger-Jensen (2015), this method has a number of advantages to the organization. One of the advantages of using this method is that it increases the speed of development. This ensures that the company achieves its objectives within a short period. This increased speed as well cuts the costs incurred as it takes less time to come up with an idea and to take the same through the stages to the final stage of product launch.

The method is also able to produce better quality (Sommer, Hedegaard, Dukovska-Popovska & Steger-Jensen, 2015). Quality is important especially when it comes to the products that consumers want. Quality is a strategy that companies use to achieve a competitive edge over their competitors. Therefore, it is very good method to ensure that high standards of quality are achieved. The other advantage of the method is that it ensures greater discipline and better performance overall compared to other informal development processes (Sommer, Hedegaard, Dukovska-Popovska & Steger-Jensen, 2015).

Using the tool as well decreases iterations, as the entire process is predictable from the commencement to the final product. The method  has been established to help improve performances at the fuzzy front end stage through development processes (Sommer, Hedegaard, Dukovska-Popovska & Steger-Jensen, 2015). Fuzzy from end is set of activities done even before the process of defining requirements specification is over. This stage therefore requires the team to deliberate on what the product should do to meet or satisfy the perceived business needs.

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According to (Grönlund, Sjödin,  & Frishammar, 2010), stage-gate methodologies are known across the world and are mostly used in industries  all over the world to help bring order to chaotic process of product innovation. In a survey carried out, it was found out that 60 percent of those responding NPD functions were in one way or another using Stage – Gate methodology. The methodology coined by Robert Cooper was to help achieve efficiency.

It is therefore both an operational and a conceptual model that helps to move product across all the phases of development (Grönlund, Sjödin & Frishammar, 2010). It achieves effectiveness and efficiency through integrating in a process known as ad-hoc that is lacking in many industries. The gates function as top and go and they as well help to prioritize points for decisions for the future of the project are to be made (Grönlund, Sjödin & Frishammar, 2010).

The functional groups known as gatekeepers are the ones that man them and they help in project evaluation on the basis of business rationale, quality of execution, and quality of action plan. This therefore, indicates the magnitude of scrutiny and gate keeping involved in using the methodology (Grönlund, Sjödin & Frishammar, 2010). All this is done to avoid errors. For instance, the execution must be of high quality. The business rationale is also put to consideration. Understanding the purpose of the business is key to ensure that implementation is done in a good manner to have positive impacts on the project.

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Research has shown that this method is highly appreciated by many industries for its potential to energize and to speed up the new product development initiatives (Grönlund, Sjödin & Frishammar, 2010). Despite, this, there have been criticism from other quarters leveled against using Stage-Gate method. Critics argue that the method is time consuming, and this leads to time wasting (Grönlund, Sjödin & Frishammar, 2010). The time wasted could have been used in a valuable venture.

Others criticism of the method include no provision of focus, it requires that one follows bureaucratic procedures and it restricts learning opportunities (Grönlund, Sjödin & Frishammar, 2010). The bureaucratic procedures are evidenced as the methodology adherse to the process of NPD from start to the final stage. This too is not pleasing and they feel that it should be modified. The restriction of learning opportunity is also a weakness that should be addressed quickly. The method is linear and it does not provide a better platform for other to learn.

 Next generation stage-gate process method has been developed in response to the criticism against this method (Grönlund, Sjödin,  & Frishammar, 2010). The motivation  for developing is for improving efficiency and speeding up of processes through incorporation of fluid stage with fuzzy and series of overlapping or confrontational go decisions. More developments on the method have focused on making it faster, flexible, adaptable, and effective (Grönlund, Sjödin & Frishammar, 2010). Some of the companies that have used State-Gate processes have also begun to accommodate open innovation activities.

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The development in the NPD process demonstrates the importance of proper tools and methodologies to rely on during NPD process. Many companies have utilized stage-Gate method and they have succeeded in their NPD process. The level of speed has increased with the method. Level of efficiency and effectiveness has also increased and these are some of the reasons that still compel firms to rely on the same.

Constructive criticism against the method has also emerged. Nevertheless, instead it is important and constructive to receive criticism so that the inspiration to create a more appealing and active methodology is   reached. The most important thing is that researchers are producing new advanced methods to help improve management of NPD process. Such improvements method makes management of NPD process even more productive and plausible.

As I conclude, new product development process is very important and has to be taken serious if companies are concerned about the future. It is through NPD that companies and industries are able to survive the competition and even manage to achieve a competitive edge. Competition has become high and the only way to avoid the same is to create products that are unique to the market. This process of development must therefore go through different stages to ensure that the final product is of high quality, it meets the expectation of the customer, it also adds value to the customers, and that it has to bring returns to the company.

A venture that the company investments on should have tangible benefits to be of value. In NPD, it is important to understand that it involves different components that that are of great important to the success of the entire process. These components also phases include generation of ideas and opportunities, product concept development, concept setting, design and engineer of the products and lastly, prototype development as well as testing.

Various methods are as well used for management of these processes. Stage-gate is one of the methods that I would use in the project. The method has quite a number of benefits that firms accrue. Even though, the method has some weaknesses, efforts are underway to ensure that the method is improved to offer value to the firm.

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Ale Ebrahim, N, Ahmed, S, & Taha, Z 2010, ‘Critical factors for new product developments in SMEs virtual team’, African Journal of Business Management, vol. 4 no.11, pp. 2247-2257

Grönlund, J., Sjödin, D. R., & Frishammar, J. (2010). Open Innovation and the Stage-Gate Process: A revised model for new product development. California Management Review, 52(3), 106-131.

Hauser, J, & Dahan, R 2007, ‘New product development. Retrieved from: er%20on%20New%20Products.pdf

Jou, Y. T., Chen, C. H„ Hwang, C. H., Lin, W. T., and Huang, S. J 2010, ‘A study on the improvements of new product development procedure performance: An application of      design for Six Sigma in a semiconductor equipment manufacturer’, International Journal of Production Research, vol. 48 no. 19, pp.573-5591.

Salgado, E, Salomon, V, & Mello, C 2012, ‘Analytic hierarchy prioritisation of new product development activities for electronics manufacturing’, International Journal Of  Production Research, 50, 17, pp. 4860-4866, Business Source Complete, EBSCOhost,         viewed 27 November 2015.

Sommer, A, Hedegaard, C, Dukovska-Popovska, I, & Steger-Jensen, K 2015, ‘Improved Product Development Performance through Agile/Stage-Gate Hybrids’, Research Technology Management, 58, 1, pp. 34-44, Business Source Complete, EBSCOhost, viewed 27 November 2015.

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Uses of Porter five forces

Uses of Porter five forces
Uses of Porter five forces

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Uses of Porter five forces


Porter five forces model helps the entrepreneur to look at the type of work that is happening and make a sound decision concerning where the power of the business lies in their organisation. Once an entrepreneur has identified the source of strength in the industry he can venture in the right direction. An entrepreneur is better positioned using Porter five forces as he will identify the competition taking place in the market and identify what is expected of him to emerge more competitive (Cheng, 2013).

Identification of where the power of the business lies helps an entrepreneur in improving his situations of weakness, and all wrong steps that could have led the business in the undesired direction are avoided accordingly. When an entrepreneur wants to know if a business is profitable as he perceived, the use of Porter five forces can be of great use in gauging whether products and services produced are of better quality. The balance of power can be well understood from the use of Porter five forces by an upcoming entrepreneur (Dobbs, 2014). This paper explains how an entrepreneur can use the porter five forces and the disadvantages of using them as well.

Figure 1: A Graphical Representation of Porters Five Forces. Source: (Dobbs, 2014)

The bargaining power of the suppliers

Whenever and entrepreneur uses Porter five forces, he gets to understand better about the five forces that make a business more competitive as expected. An entrepreneur has to access how easy it is for business suppliers to drive up prices. One of the most important aspects of the luxury goods industry is suppliers. They are the business entities that take part in the manufacture of different products sold by various industries; hence, the entrepreneur should consider them accordingly (Dobbs, 2012).

For these products to be valued, it is important that they maintain a very high build quality, remain aesthetically appealing and most importantly have an element of uniqueness. An entrepreneur ought to ensure that suppliers have the ability to produce goods that meet such specifications and at the same time do them at a cost low enough to leave room for profit. Whenever suppliers are few, they will have the courage that they are in high demand, and they will tend to increase their bargaining power (Grigore, 2014). However, when suppliers are many the entrepreneur will be sure that their bargaining power is very low in the market.

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The Threat of Substitute Products

An entrepreneur has to know that substitute products accessible to the market are those which customers can use in place of what a particular brand has to offer. The middle and the high-income population of the market seeks out goods that help to portray their status and wealth. As such the demand for products like high-end electronics, designer perfumes and also designer clothes is only bound to remain (Kirchner, 2012). An entrepreneur ought to know that a company producing products that are found in other companies will reduce the threat of substitutes and make more sales.

Demand for accessing items will, therefore, remain sustained for a long time as the middle income to high-income segments of the population will maintain the need to display their affluence through these products. The majority of customers are youths who are concerned with luxury goods; hence, an entrepreneur ought to focus more on internet marketing to attract the youths who are active on social networking sites.

An entrepreneur should use the porter five forces to develop an attractive, and an appealing website that can help the youths to sell their product by taking advantage of the internet selling platforms (Sutherland, 2014). The use of porter five forces will make the entrepreneur ensure that the given company continues developing unique brands that are appealing to the youths and sell them in small quantities that are affordable to the youths.

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The Customers’ Bargaining Power

The entrepreneurs should make use of the Porter five forces analysis to ensure that the customer bargain power is reduced.  An activity like this will mostly take place where major companies employ the mergers and acquisition program. They will end up merging with smaller companies and make them more powerful than before. After merging and acquisitions of various companies has taken, place customers bargaining power will be reduced and the formed company will now have the power to determine prices of different goods in the market (Wilson, 2015).

The company will now determine the market price whereby; the customers will have no say rather than purchasing goods and services at the given price. The competition will be reduced to such a level as the competitors will have now emerged; hence, work towards achieving the same goal of success. Any entrepreneur should not let the customers determine the prices in the market, but he ought to struggle to be the determinant through reducing the competition taking place.  When the bargaining power of the customers is very high, then it will imply that the industry is less attractive, and this should not be the case.

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The Competitive Rivalry within the industry

The fact that there is a group of about 10 to 15 companies that have established themselves in the accessible market is a clear indication that this industry is subject to a very high intensity of the competitive rivalry between the players. An entrepreneur must ensure that his company is involved in the supply of certain products is keen to put its best foot forward to reduce the competition from its rivalry. Different companies, however, have different strengths in different aspects of the accessible market.

A well enticing entrepreneur will have a lot of success in the American market; since, it is spreading its tentacles to Asian markets such as Japan and China whose middle-high income populations are increasing fast. An entrepreneur ought to ensure that his company has the considerable market to emerge best in the supply of goods and services that are in high demand in the market (Alrawashdeh, 2013). An entrepreneur must take note of the upcoming opportunities through the use of Porter five forces in the market to reduce the competition rivalry that is highly evident.

Production of quality products helps a company to have lower competition rivalry. People will tend to love products that are durable and of high quality; hence, such an organisation will emerge successful in with fewer competitors. If a company makes many products and services that cater to the needs of its consumers at any given time, it will be more competitive due to its reliability.

The cost of products also determines if a company will be more competitive in its production whereby; if its prices are too high such that people are struggling to afford them, the customer will be very few (Fitzpatrick, Anh-Nguyen & Cayan, 2015). The entrepreneur ought to consider some potential factors that will make the industry more competitive like; having a powerful competitive strategy and a high degree of transparency.

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The Threat of New Entrants

An entrepreneur ought to make use of the porter five forces to ensure that the company invests in millions of dollars on various aspects of the operation that will be more productive in the very end. At the same time, the company needs to develop brand recognition in the market  for better recognition (Prasad, 2010). While the former is difficult to achieve, the latter is even more complicated given its abstract and intangible nature of the task to block new entrants in the industry.

Middle to high-income earners will be attracted by brands that are perceived to be more famous and attain better quality. The only way that a new entrant can achieve fame and market access of established names is by having a virtually unlimited financial budget. An entrepreneur ought to use porter five forces analysis to motivate smaller players are increasingly finding it possible to circumvent these barriers and instead employ web-based platforms such as Facebook and Amazon sell their products (Rajasekar & Raee, 2013).

The presence of established companies controlling the larger market shares the possibility of others entering the market is very minimal; since, the established firms will fight back to protect their market share. An entrepreneur should struggle to ensure that the industry has a higher threat to the entrant to reduce the completion and many people from entering the industry anyhow.

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The limitations of using the Porter five forces

Porter five forces were established in a more different environment as compared to the one that the industries are operating in today. In the current world, the pace of change is more rapid, and this fact affects the use of the porter five forces. The porter five forces is a model that provides the entrepreneur with only a snapshot of what is expected yet, there is still more that he does not know.

The use of porter five forces makes it more difficult for an entrepreneur to define the industry that he is handling and make the better specialization of the outcome results. An entrepreneur should know that all the non-market forces that are taking place are not considered in the use of porter five forces. Porter five forces in most case are not well applicable in for the analysis of simple market structure rather they only cater for big markets alone.

It is prudent for an entrepreneur to know that porter five forces majors its argument on competition matter, and this shows that it is narrow not much wide as required (McCann, 2011).  An entrepreneur might find it hard in analysing simple markets using the porter five forces as it does not cater for smaller markets. Technology is changing too fast to extend that shopping and marketing are done online; hence, an entrepreneur must perfect this to accommodate everyone with his or her needs and capture the market.

An entrepreneur should be aware that the use of porter five forces in the current world has contributed to only very few market structures remaining static as they were before. The use of porter five forces has made an entrepreneur learn that there are needs required in changing radically to suit the market position of any given company. The use of porter five forces has led to technology, reducing the length of a time of any given product to reach the market. Most of the products get to the market before the maturity time is near to cater for the needs of the fastest growing population.

Technology that is used in different industries makes these products get to the market immaturely, thus the increased cases of disease like cancer among others. An entrepreneur should be aware that the use of porter five forces is contributing to technology that affects the production of goods in industries (McMillan, 2010). An entrepreneur must know that use of porter five forces has increased the burden of information as the response of the organization is done for more than just the market forces.

There is a high need for all organizations to respond to the country’s legislation, corporate ethics and all the required social responsibilities to cater for the needs of all in the society.  The use of porter five forces makes it more difficult to incorporate all the required implication of strategic alliances like sharing of skills as well as responding to given opportunities.

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An entrepreneur should be aware that the use of porter five forces has reduced the rate of change in most industries leading to changes in the stability of the market structure and industry experiences. Regular updates are necessary in making sure that the knowledge obtained through the use of porter five forces is transferred to other generations, failure to which it will be eroded completely.

An entrepreneur ought to be aware of the fact that the use of porter five forces has led to difficulties of integrating complexities that are evident in the market today with the use of product groups of organization and various interrelations taking place (Ortega, Jalón, ,M.Luisa & Menéndez, 2014). Also, an entrepreneur should be aware that if his organization defines the market segment to be very slow, then some of the key elements of prosperity might be overlooked.

The legislation that exist among buyers and sellers ought to be looked accordingly in making sure that all activities are well coordinated. The use of porter five forces has changed the way transactions between sellers and buyer were transacted to extend that most of the communications and transaction are done online.

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 When an entrepreneur wants to know if a business is profitable as he perceived, the use of porter five forces can be of great use in gauging whether products and services produced are of better quality. This paper explains how an entrepreneur can use the porter five forces and the disadvantages of using them as well. Demand for accessing items will, therefore, remain sustained for a long time as the middle income to high-income segments of the population will maintain the need to display their affluence through these products. The merged companies will now determine the market price whereby; the customers will have no say rather than purchasing goods and services at the given price.


Alrawashdeh, R. 2013, “The Competitiveness of Jordan Phosphate Mines Company (JPMC) Using Porter Five Forces Analysis”, International Journal of Economics and Finance, vol. 5, no. 1, pp. 191-200.

Cheng, D.S.Y. 2013, “Analyze the Hotel Industry in Porter Five Competitive Forces”, Journal of Global Business Management, vol. 9, no. 3, pp. 52-57.

Dobbs, M.E. 2012, “Porter’s Five Forces in Practice: Templates for Firm and Case Analysis”, Competition Forum, vol. 10, no. 1, pp. 22-33.

Dobbs, M.E. 2014, “Guidelines for applying Porter’s five forces framework: a set of industry analysis templates”, Competitiveness Review, vol. 24, no. 1, pp. 32-45.

Fitzpatrick, B.D., Anh Nguyen, Q.Q. & Cayan, Z. 2015, “An Upgrade To Competitive Corporate Analysis: Creation Of A “Personal Finance Platform” To Strengthen Porter’s Five Competitive Forces Model In Utilizing”, Journal of Business & Economics Research (Online), vol. 13, no. 1, pp. 54-n/a.

Grigore, A. 2014, “Book Publishing Business in Romania – An Analysis from the Perspective of Porter’s Five Force Model”, Revista de Management Comparat International, vol. 15, no. 1, pp. 31-47.

Kirchner, M. 2012, “Porter’s Five Forces in the Finishing Industry”, Products Finishing, vol. 76, no. 12, pp. 52-53.

McCann, J. 2011, “China’s Textile and Apparel Industry and the Global Market: Five Competitive Forces”, S.A.M.Advanced Management Journal, vol. 76, no. 1, pp. 33-42,54,2.

McMillan, C. 2010, “Five competitive forces of effective leadership and innovation”, The Journal of business strategy, vol. 31, no. 1, pp. 11-22.

Ortega, A.G., Jalón, ,M.Luisa Delgado & Menéndez, J.Á.R. 2014, “A strategic analysis of collective urban transport in Spain using the Five Forces Model/Un análisis estratégico de transporte urbano colectivo en España usando el modelo de las Cinco Fuerzas”, Investigaciones Europeas de Direccion y Economia de la Empresa, vol. 20, no. 1, pp. 5-15

Prasad, A. 2010, “Strategy as “Inferior” Choice: A Re-interpretation of Porter’s “What is Strategy?””, Journal of Management Research, vol. 10, no. 1, pp. 15-24.

Rajasekar, J. & Raee, M.A. 2013, “An analysis of the telecommunication industry in the Sultanate of Oman using Michael Porter’s competitive strategy model”, Competitiveness Review, vol. 23, no. 3, pp. 234-259.

Sutherland, E. 2014, “Lobbying and litigation in telecommunications markets – reapplying Porter’s five forces”, Info : the Journal of Policy, Regulation and Strategy for Telecommunications, Information and Media, vol. 16, no. 5, pp. 1.

Wilson, R.C. 2015, “Mayhem: A Hands-on Case Playing Activity for Teaching Porter’s Five Forces to Undergraduate Business Students”, Small Business Institute Journal, vol. 11, no. 2, pp. 48-59

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Rentall Trucks Case Study

Rentall trucks
Rentall Trucks

Rentall Trucks Case Study


This paper will provide an analysis of the case study of Rentall Trucks using Markov Analysis. The problem statement of the case is about legal issues that surrounded the operation of two main competitors in the truck renting industry Rentall and Rentran. The scope of a problem is the extent of perception, action or inquiry of a concept. In our case study, the scope is an omission in the contracts leading to the sale of Rentall Trucks that could cost the firm millions of dollars according to Jim Fox.  (Render, Stair, R. Hanna, & Hale 2015). The critical decision issues to be addressed by Rentall Trucks include how to increase the competitive edge and maintain a large market share in the industry.


One of the critical elements of the Rentall Trucks case is the fact that during its sale, the contracted law firm omitted a clause that would prove costly in the long-run. Folley, Smith and Christensen failed to include a clause that would prevent Bob Renton from competing directly with the firm. This led to the creation of Rentran. The case provides another critical element in which Rentall faces stiff competition from Rentran, despite the fact that it is only a few months into its operations.

In six months, Bob has succeeded in convincing and poaching a number of key executives from Rentall into his company, Rentran. The firm managed to acquire a market share of approximately 5% in the first few months of its operation while Rentall had 80% and National rentals, another competitor, had 15% (Render, Stair, R. Hanna, & Hale 2015). The Market share determines the portion of a market controlled by a particular firm (Rego, Morgan, & Fornell, 2013).

It is the percentage of total sales in a given market earned by a company (Gale, 2014). Pete Rosen, the president of Rentall Trucks, got concerned about the situation and decided to conduct research to determine future projections of the firm and the market. His concerns were that his firm would be incapable of maintaining 50% of the market in the future.

The case has provided a clear set of facts on the current scenario facing the firms. These facts were established after a research company hired by Pete Rosen conducted an analysis on truck rental customers. The sample size was 1000 potential and existing customers. Of these, 800 were Rentall customers, while 60 and 140 were Rentran and National customers respectively. After one month, the sample was analyzed again.

It was found that 200 Rentall customers switched to Rentran, 80 switched to National, 3 Rentran customers switched to rental, six switched to National, and finally, 14 National customers switched to Rentall and 35 to Rentran (Render, Stair, R. Hanna, & Hale 2015). An in-depth review of the essential issues is offered by these facts.


In addressing the main points outlined in the case, various recommendations are needed to solve the problem statement. According to Jim Fox, Rentall Trucks could do nothing to correct the problem of the costly contract omission by the law firm Folley, Smith, and Christensen. The only applicable solution would be to formulate and implement effective business strategies.

These strategies would provide a framework through which counter measures would be adopted to prevent Rentran’s activities and market advancements. The policies adopted would be to curb Rentran’s ability to lure away both customers and investors from Rentall. Three areas would require to be reviewed and appropriate changes made. These areas are advertising, rental policy, and product line.

The issue of rental policies would require that truck rental business is made easier and faster. This would necessitate the implementation of some of the policies used by car rental agencies like Hertz. To attract more customers, changes in the product line would have to include comfortable and easy to drive trucks, trucks fitted with automatic transmission, air conditioners, quality radio and stereo tape systems, comfortable bucket seats and cruise control (Render, Stair, Hanna, & Hale 2015). Zenetti and Klapper (2016), state that advertising promotes sales by influencing the behavior of potential customers.

This showed that additional advertising was required to be aggressive and immediate. A good company had to be contracted and advertising in journals and the television increased. Implementation of these strategies would give Rentall Trucks a chance of maintaining their close to 80% market share. Changes in the advertising strategy would ensure that a bigger target audience is reached and their market behavior influenced to opt for Rentall Truck products and services. This would increase the number of new customers. On the other hand, changes in the product line and rental policies would help maintain a loyal customer base for the firm.


The recommended course of action is justifiable since policy makers and scholars alike agree to the effectiveness of the stated strategies. The above recommendations have been applied elsewhere and hence, are tried and tested. The justification for the recommendations is that:

1.)    Advertising is a proven strategy to help convince more customers to trust the products and services being offered by a company as explained by Buil, Chernatony, & Martínez, (2013). Rentall Trucks is justified in increasing advertising, especially in television and journals.

2.)    Changing a product line constitutes to rebranding. The strategy of rebranding helps a company in that it proves to doubtful customers that the brand has reinvented itself andwill, therefore, be in a position to satisfy their tastes and preferences more that before (Todor, 2014). To Rentall Trucks, changes in the product line will ensure that those customers who had switched to their rivals are more convinced about its service and product quality and will be motivated to switch back. 

3.)    Reviewing of rental policies will revolutionize the whole industry. This is due to the fact that if Rentall are successful in simplifying the processes involved in renting trucks, they will set a standard to be followed by all competitors. Setting standards will make them stand out as market leaders and will therefore have that largest market share.


This case study provided a case scenario of Rentall Truck Company seeking to gain a competitive advantage over its competitors, Rentran and National. The companies were competing for the market share in the truck renting industry. Rentall faced stiff competition from Rentran, a company owned by its former founder. They found themselves in this situation due to a blunder of omission of an important clause in its contacts. To retain its customers, Rentall recommended changes in its advertising strategies, product line and rental policies. The strategies were justifiable through since they were tried and tested. The justification was further improved by the market research conducted by Meyers Marketing Research firm.


1. What will the market shares be in one month if these changes are made? If no changes are made

Rentall – π1 = 0.8

Rentran – π2 = 0.06

National Rentals – π1 = 0.14

Tree diagram (Month 1 with no change)

0.65                 0.25                 0.1

P =       0.05                 0.85                 0.1

0.65                 0.25                 0.1

π (1) = π (0)P

0.65                 0.25                 0.1

= (0.8, 0.06, 0.14)       0.05                 0.85                 0.1

0.65                 0.25                 0.1

= 0.52+0.003+0.091, 0.2+0.051+0.035, 0.08+0.006+0.014

= 0.6, 0.29, 0.1

= 60% 29% 10%

Market share without the changes will be:

60% for Rentall

29% for Rentran

10% for National Rentals

Tree diagram (Month 1 with change)

0.85                 0.125               0.025

P =       0.15                 0.75                 0.1

0.2                   0.25                 0.55

π (1) = π (0)P

0.85                 0.125               0.025

= (0.8, 0.06, 0.14)       0.15                 0.75                 0.1

0.2                   0.25                 0.55

= 0.68+0.009+0.028, 0.1+0.045+0.035, 0.02+0.014+0.077

0.72, 0.18, 0.1

72%. 18%, 10%

Market share without the changes will be:

72% for Rentall

18% for Rentran

10% for National Rentals

This shows that Rentall will have a larger market share if the actions suggested are implemented. Rentall’s market share will remain high while Rentran will grow at a slower rate. National Rental’s market share remains the same.

2. What will the market share be in three months with the changes?

π (n) = π (0)Pn

π (3) = π (0)P3

                                     0.61                0.002               0.00002           3

(0.8, 0.06, 0.14)           0.003               0.42                 0.001

                                    0.008               0.27                 0.17

            = 0.6, 0.3, 0.1

Market share after 3 months will be:

60% for Rentall

30% for Rentran

10% for National Rentals

3. If market share remains the same, what market share will Rentall have in the long-run?Ho does this compare to if the changes were not made.

            If the market conditions remain the same, the market share for Rentall in the long-run would keep reducing, though at a lower magnitude than if Rentall did not make the changes. The new market shares are shown in the tables below. The market share moves from 80% to 72% in month 1 to 66 % in month 2, 61% in month 3, 58% in month 4 and 56% in month 5.

If the changes were not made, Rentall’s market share would have deteriorated quite fact, moving from 80% to 61% in month 1, 48% in month 2, 40% in month 3, 35% in month 4 and 32% in month 5. This would be a significant loss to Rentran, which would have 58% of the market by the fifth month. Therefore, it can be concluded that the changes will reduce the rate at which the company loses its market share to Rentran. However, Rentall still continues to lose its market share and better strategies are required to enhance competitiveness.                                                  

After Change (Excel calculation)
ProbabilitiesCurrent Market share
  Market share
Month 1Month 2Month 3Month 4Month 5
Before Change (Excel calculation)
ProbabilitiesCurrent Market share
  Market share
Month 1Month 2Month 3Month 4Month 5


Buil, I., De Chernatony, L., & Martínez, E. (2013). Examining the role of advertising and sales     promotions in brand equity creation. Journal of Business Research, 66(1), 115-122.

Gale, . (2014). Market share reporter. Place of publication not identified: Gale, Cengage Learning.

Rego, L. L., Morgan, N. A., & Fornell, C. (2013). Reexamining the market share–customer satisfaction relationship. Journal of Marketing, 77(5), 1-20.

Render, B., Stair, R. M., Hanna, M. E. & Hale T. S. (2015). Quantitative analysis for management. (12thed.). Upper Saddle River, NJ: Pearson.

Todor, R. D. (2014). The importance of branding and rebranding for strategic marketing. Bulletin of the Transilvania University of Brasov. Economic Sciences. Series V, 7(2), 59.

Zenetti, G., & Klapper, D. (2016). Advertising Effects Under Consumer Heterogeneity–The Moderating Role of Brand Experience, Advertising Recall and Attitude. Journal of Retailing, 92(3), 352-372.

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Competitive Advantage: Case Study

Competitive advantage
Competitive advantage

The new product that is being introduced as part of Whirpool production will be marketed along the market chains that the company has used and has competitive advantage over other products in the market. The company will concentrate on marketing the product in the Western nations, followed by the Asian countries and lastly the African nations based on the sales margin of their earlier products (Chakraborty, 2017).

Customers in the industry have expressed the problem of having their refrigerator doors not tightly closing when they are shut.The company GE appliances that is one of the competitors has admitted to the existence of the problem on their website, but they have only provided a limited number of solutions (Refrigerator-Freezer Door Pops Open, 2017).

In the industry, none of the companies have come up with a long-lasting solution like the new invention. The product will provide the company with a competitive advantage in the consumer home appliances. The company does sell their products in over 170 countries, and by the first quarter of 2017, they had a market share of 34.33% (Whirlpool Corp Comparison to its competitors, market share, and competitiveness by Segment-CSIMarket, 2017).

How to Achieve a Competitive Advantage

In order to succeed in any market a company has to decide which strategy is more appropriate to use, which means identifying the sources of a potential competitive advantage such as skills or resources. Superior skills in creating a special product can represent the element that is setting the company apart from its competitors. That is easily translated into a very good quality of the products.

Reference List

Chakraborty, A. (2017). Leverage Analysis: A Study on Whirlpool LTD. Nopal Institute of Management Studies-Department of Management.

Refrigerator-Freezer Door Pops Open. (2017). Retrieved 15 September 2017, from

Whirlpool Corp Comparison to its Competitors, Market share, and Competitiveness by Segmet-CSIMarket. (2017). Retrieved 15 September 2017, from

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