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Driving Forces

Changes in long-term industry growth rate

Changes in buyers of the product & how they use it Product innovation

Technological change/process innovation

Marketing innovation

Entry or exit of major firms Diffusion of technical knowledge

Changes in costs and efficiency

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the digital revolution

Deregulation of the telecommunicationsindustry

social mediaization throughout society

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Political Driving ForcesIncluding:

 An Open economy, Control of theInternet, Economic Growth, Power of the

United Nations, Proliferation of nuclear 

weapons and World Unification, Olympic

Games, Elimination the gap between poor andrich,Strike 

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Technological Driving ForcesIncluding:

 Artificial Neural Networks, Gaming

Industry,Mobility, Nanotechnology, Peer-to-

Peer Technology, The Rapid Increase in WiFi

Transmission Rates, VirtualCommunitiesand Voice-recognition system 

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Economic Driving ForcesIncluding:

E-commerce in developing countries, Crisis of the capitalism, , Open Source, Declining

Dollar , Families' economic condition, Shift to

 Alternative Energy Sources and economic

condition, Foreign Exchange Rate 

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Environmental Driving ForcesIncluding:

Introduction of greenhouse gases emissionstrading, Global Dimming, Acid Rain, E-paper 

solution instead of the paper work, The change

of children playing sports to children playing

videogames and Chinese Pollution Problemsby Rapid Growth, Increasing efforts to make

Seoul a clean and green place to live 

 

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Societal Driving ForcesIncluding:

 Aging population, liberalization of the health

care market, the rise of ethics, people's

increasing leisure time, Community

Feeling, Digital Literacy, Future Value of anMBA, Increasing influence, Increasing

Mobility, Violence in computer gamesTime as a

valuable resource and Population 

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Common Types of Driving Forces

Increasing globalization of industry

Market shift from standardized to differentiatedproducts

New regulatory policies and/or governmentlegislation

Changing societal concerns, attitudes, and risklifestyles

Changes in the degree of uncertainty andbusiness risk

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Key Success Factors (KSFs) in an

Industry

What are industry KSFs? 

 – The competitive elements that every industry member must be competent at doing or concentrate

on achieving in order to be competitive and

financially successful in the marketplace

Specific strategy elements

Product attributes

Resources,Competencies & Competitive capabilities

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Identifying Industry KSFs

KSF’s in an industry spell difference between

 – Profits and loss

 – Competitive success or failure

 Answers to three questions pinpoint KSF’s 

(1) On what basis do customers choose between competing

brands or sellers?

(2) What must a seller do to be competitively successful – whatresources and competitive capabilities does it need?

(3) What does it take for sellers to achieve a sustainable

competitive advantage?

 – KSFs consist of 3-5 major determinants of financial &

competitive success in an industry

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Common Types of KSFs

Technology-related – Scientific research expertise; product innovation

capability; expertise in a given technology; etc.

Manufacturing-related – Low-cost production efficiency; low cost plant

location; Quality of manufacture, low-cost product

design & engineering, etc Distribution-related

 – Strong network of wholesaler distributors/dealers;ability to gain ample space on retail shelves;accurate filling of customer orders; short deliverytimes, etc.

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Common Types of KSFs

Marketing-related – Customer service; merchandising skills; clever 

advertising; attractive styling or packaging,Guarantees & warrantees

Skills-related – Superior workforce talent; quality control know-how;

design expertise; technological expertise, etc.

Organizational capability – Superior information systems; ability to employ

internet to conduct business; managerial expertise

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Benefits of Doing an External

Analysis

Proactive Managers anticipate changes andplan accordingly – Provide information for 

Planning

Decision making

Strategy formulation

 –  Acquire and control needed resources – Cope effectively with increasingly dynamic

environment

 – Make a difference with higher performance

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Key Success Factors

• Strategic Market Segmentation • Understand Competitor’s Strengths and

Weaknesses

• Respond to Customer’s Needs and Wants

• Efficiencies Through ECommerce/Technology

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• Reliable Delivery

• Strong Service • Solid Sales and Support Staff 

• Reduces Costs, Operates Lean

• Utilize Employees Strategically