Industry dynamics are an important part of strategic management. Michael Porter’s Five Forces Model for competitive forces analysis is handy. By looking at these forces, businesses can consider what kind of opportunity or threat they can in the industry, then design strategies that help them upgrade their market position. The Five Forces are: 1. Competitive Rivalry: This force examines the intensity of competition among existing firms in the industry. Factors like the number of competitors, product differentiation, and switching costs influence this force. 2. Threat of New Entrants: This force assesses how easy or difficult it is for new companies to enter the market. High barriers to entry, such as high capital requirements or strong brand loyalty, can deter new entrants. 3. Bargaining Power of Suppliers: This force evaluates the influence suppliers have on pricing and terms. If suppliers have strong bargaining power, they can charge higher prices or offer less favorable terms to businesses. 4. Bargaining Power of Buyers: This force assesses the influence customers have on pricing and terms. If buyers have strong bargaining power, they can negotiate lower prices or demand better terms. 5. Threat of Substitute Products or Services: This force examines the availability of alternative products or services that can satisfy the same customer needs. A high threat of substitutes can limit the profitability of an industry.