Mid Course Exercise Essay Example | Topics and Well Written Essays - 1250 words

Mid Course Exercise - Essay Example This is the real case in which firms try to differentiate their product or service offerings just to be able to gain considerable market share in the midst of an ongoing competition. The threat of new entrants on the other hand is alarming to the existing firms of the same industry. This is because the new entrants try to remarkably prove themselves and share something new that will create a significant impact in the market (Porter, 1980). Threats of substitute products or services bring forward the opportunity for customers to have various choices. As a result, customers have strong market power because of their chance to choose for the best price, quality and other intrinsic features of a product or service offering (Porter, 1980). Bargaining power of buyers may happen if there are various product or service offerings to choose from. This happens in a highly diversified market where there are existing competition trying to diversify their product or service offerings resulting to b etter substitutes at remarkably lower prices or even higher quality, the bottom line is to extend market power (George, Joll, & Lynk, 1992). Bargaining power of sellers on the other hand can affect the level of competitive intensity within an industry by taking advantage of maximizing their opportunities. They could either monopolize the industry under a monopolistic competition (McEachern, 2011). This is evident in the case of Philippine Petroleum Industry and other third world countries which are under the bargaining power of multinational corporations on petroleum products. Relative power of other stakeholders is also influential on the competitive level of an industry. One basic example is the ability of Apple Incorporated to successfully penetrate the mobile phone industry with its innovative smart phone technology (Apple Incorporated, 2011). This happened because Apple is supported by various stakeholders for the successful promotion of its breakthrough technology. As noticed, the market today is bombarded with different styles and options for smart phone technology. 2. What information is needed for effective strategy formulation? Why? Answer: An organization must be able to measure the level of commitment of its top personnel such as the managers or supervisors in order to be able to understand how well they would want to continue its vision (Ferrell, Fraedrich & Ferrell, 2010; Zanini, 2007; Hitchcock & Willard, 2009). In fact, it is found that a strong commitment among top managers in an organization is associated with effective strategy implementation outside the bound of environmental dynamism (Willauer, 2005). This only implies that an effective strategy formulation does not only ensure finding the right information about the competitors’ strategic moves or the external environment in general, but more so, there is a need to understand the internal environment because it definitely affects how the entire organization would function in great detail in the midst of its entire business operation. For instance, we know how the economic downturn in 2008 affected the United States and the business firms. However, such external factor sometimes may be overlooked but one thing that could not be missed out is the information about employee commitment. In times of crisis like this, employees would most likely to consider many issues and on top of them it might be about their concern on sustainability. How they could feed their family, or ensure making both ends