Assess by applying the Porter’s five forces Model, the level of competitiveness of MTML
In the age of globalisation, companies need to become competitive to be successful in the market place. Organisations must understand its business environment to gain a competitive advantage as well as a sustainable development. A company’s business environment is constantly influenced by external and internal factors that shape daily decisions and the company’s performance. In the light of this, companies have to be competent and efficient to adapt to the business world by developing various strategies such as differentiation, cost leadership which will result in result in enhancing their competitiveness.
By using Michael Porter’s Five forces model, I will analyse the level of competitiveness in the Mahanagar Telephone Mauritius Limited (MTML).
Porter’s Model
Porter’s model Five Forces of Competition is commonly used in order to specify and analyze different factors that could affect the company’s profitability and competitiveness. Therefore, first, the attractiveness of an industry, and, second, a company’s position within the industry are analyzed. As Porter (1991) explains, “that is what strategy is all about – making choices about how you position your company in its competitive environment; no matter how attractive the game is, you will not do well if you do not hold a good position in it”
In any industry there are five competitive forces that collectively determine the attractiveness of the industry:
Three sources of “horizontal” competition – threat of substitutes, rivalry among existing competitors and entry of new competitors,
Two “vertical” sources of competition – bargaining power of buyers and bargaining power of suppliers (Grant, 2005)
As Porter (1985) further explains, each company strives to capture a profitable and sustainable position within an industry in order to defend itself from the influence of the forces that determine the...