How do you predict the industry life cycle?

1 PESTEL framework

The PESTEL framework is a tool that helps you analyze the external factors that affect the industry, such as political, economic, social, technological, environmental, and legal aspects. By examining these factors, you can identify the opportunities and threats that the industry faces, as well as the drivers and barriers of growth. For example, you can use the PESTEL framework to assess how changes in regulations, consumer preferences, or technological innovations might impact the industry life cycle.

2 Porter's five forces analysis

The Porter's five forces analysis is a tool that helps you evaluate the competitive intensity and attractiveness of the industry, based on five forces: the threat of new entrants, the bargaining power of suppliers, the bargaining power of buyers, the threat of substitutes, and the rivalry among existing competitors. By analyzing these forces, you can determine how profitable and sustainable the industry is, as well as the sources and barriers of competitive advantage. For example, you can use the Porter's five forces analysis to estimate how easy or difficult it is to enter or exit the industry, or how strong or weak the competitive pressure is.

3 S-curve model

The S-curve model is a tool that helps you visualize the growth pattern of the industry, based on the adoption and diffusion of innovations. The S-curve model shows that the industry growth rate follows an S-shaped curve, with four stages: introduction, growth, maturity, and decline. By plotting the S-curve model, you can estimate the current and future stage of the industry life cycle, as well as the potential for further innovation or disruption. For example, you can use the S-curve model to forecast how long the industry will grow or decline, or how likely it is to face new entrants or substitutes.

4 BCG matrix

The BCG matrix is a tool that helps you classify the products or business units within the industry, based on their market share and market growth. The BCG matrix divides the products or business units into four categories: stars, cash cows, question marks, and dogs. By using the BCG matrix, you can evaluate the performance and potential of the products or business units, as well as the allocation of resources and investments. For example, you can use the BCG matrix to identify which products or business units are leading or lagging in the industry, or which ones require more or less attention and funding.

5 Here’s what else to consider

This is a space to share examples, stories, or insights that don’t fit into any of the previous sections. What else would you like to add?