3. Definition
Industry evolution :
Slow process of
change from
one form or level to a
better or higher one,
or that brings into
being a superior or
new order.
4.
5. Fragmentation
• The process or state of breaking or being broken into fragments.
• Also known as Introduction stage.
Shakeout
• Emergence of new industry begins at this stage.
• Competitors realises the business opportunities.
Maturity
• Efficiencies render competitive advantage.
• Factors like price, competition & cooperation are being complex.
• Availability of substitutes make competition aggressive.
Decline
A stage during which a war of slow destruction between
businesses may develop and those with heavy bureaucracies
may fail
6. Refers to the number, size and relative strength of
competitors.
It depends upon whether the dominant design is
standardized & accessible to new entrants.
Some economists have found that concentration leads
to higher prices
Industrial concentration also is promoted by barriers to
entry, which make it difficult for new firms to displace
established firms.
7. The Driving Forces of Industry Evolution
Customers become
more knowledgeable
& experienced
Diffusion of
technology
Demand growth
slows as market
saturation approaches
Customers become
more price conscious
Products become
more standardized
Distribution channels
consolidate
Production shifts
to low-wage
countries
Price competition
intensifies
Bargaining power
of distributors
increases
BASIC CONDITIONS INDUSTRY STRUCTURE COMPETITION
Excess capacity
increases
Production
becomes less R&D
& skill-intensive
Quest for new
sources of
differentiation
8. Drive change within
your organisation,
adapting it to a dynamic
environment and
controlling how it
evolves.
9. The many economic,
competitive and global
factors that influence how
organizations conduct
business are constantly
and evolving.
10. Driving forces of environmental change:-
• Population
• Consumption
• Technology