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Question 1a .i ) Porter s five forces analysis is used for analyzing patience dynamics which are likely to affect the business large(p) punishment of an validation . It is an analysis of the external environment in which the organization operatesA ii ) The five forces chart in respect of the nerve industriousness is given belowForces FactorsLow Threat of newfangled catechumens High submission barriers in terms of capital costsHigh threat of substitute products many possible substitutes in the form of aluminum , plastics and other composites (-High dicker power of buyers Strong buyers (-Moderate bargaining power of suppliers Weak suppliersHigh free-enterprise(a) rivalry Intense rivalry (-a .iii ) Threat of new initiation is low in the nerve mart because as mentioned in the case , the labor had reached saturation point Therefore , a new entrant would non stand to gain from vista up operations in the industry . The volume of home(prenominal) shipments had already dropped from its peak in 1979 . However , as the industry was positioned in 1986 , projections estimated that the volume of shipments would not drop any moreover . This was good news for the existing businesses However the maturing blade market in the US would discourage new entrants . Moreover vista up a steel manufacturing business is a capital intensive business . Therefore , possible new entrants would learn to have the kind of capital structure that would be adequate to support the massive investments required . Access to technological innovations would withal discourage new entrants because the intense matched rivalry two from domestic manufacturers and foreign manufacturers had spurred rapid growth of engineering science in the steel industry and therefore a new entrant would need to have access to the very(prenominal) latest technology in to develop a warring edge . unconstipated when the new entrant had access to new technology , the emulous edge that could be derived from it would not be sustainable as competitors would be able to copy the processes of the new innovation very quickly .

Therefore the existing steel market does not present a promising picture to the potential new entrantThe threat of substitute products was heights in the industry because of the offshoot of aluminum , plastics and other composites that could be used instead of steel in the manufacturing of a wide variety of product groupsThe steel industry is characterized by high rivalry among competitors This is because the steel industry had been deregulated and as a result foreign manufacturers were able to contest in the US market . In terms of determine , the integrated steel manufacturers in the US were not competitive . As a result , the market shares of these manufacturers declined . The reason why the integrated steel manufacturers were slow to respond to the international competitive threat was that the organizational structures were all characterized by a high level of bureaucracy . Therefore any innovations that would have the potential to reduce costs would take years before they could be implemented . This resulted in loss of competitiveness on the originate of the integrated steel manufacturers...If you want to get a skilful essay, order it on our website: Orderessay

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