How can Porter's Five Forces improve collaboration with partners?

I believe we should maintain open and transparent communication channels with partners, by sharing information, insights, and market trends that can benefit immensely. In addition, collaboratively plan strategies and goals with partners. Align our objectives and resources to achieve mutual success. Regularly evaluate and assess the effectiveness of our collaboration efforts.

A point that is often missed is that the 5 forces model is intended to analyze the attractiveness of an entire industry, not the position of an individual company within it. It is very useful when making a decision on entering or exiting a market, given the attractiveness of the industry or lack thereof, but less so for formulating a specific strategy for a business to better compete in it.

Porter's Five Forces helps analyze a business's competitive landscape. Think of it as a toolkit and I use these questions to use it effectively: 1. Competition: How fierce are rivals in your market? 2. New Entrants: Can new players easily join? 3. Substitutes: How quickly can customers find alternatives? 4. Suppliers: Do they dictate terms? 5. Buyers: Can your clients influence prices? By understanding these, you're better positioned to strategize and collaborate effectively.

Recently, I came across something very interesting in a small industrial cluster in India, in the tooling industry. There was a supplier (SME) who was the sole supplier of a component to a big enterprise; due to some financial crunch and labor issues they had to stop their operations for a little more than a quarter; forcing the big enterprise to look out for other suppliers in the same industrial cluster. This led to all other SMEs working in that cluster to form a sort of unofficial consortium, deciding on a premium price and promising not undercut each other. They ended selling the part at a premium to the big enterprise and reaping massive profits for 2 subsequent quarters.

Using Porter's Five Forces, enhance partner collaboration by: 1) Merging strengths to counter competition 2) Harnessing new entrants' innovation 3) Integrating substitutes for broader offerings 4) Solidifying supplier relations, and 5) Boosting buyer satisfaction. It also important to evaluate risks to forge win-win partnerships.

When collaborating with partners, I recommend considering the approach below: 1) Recognize mutual threats. If suppliers gain power, collaborate on negotiations. 2) Address shared rivalry threats. Streamline joint efforts. 3) Counter potential entrants together. 4) Harness shared buyer relations. 5) Mind substitutes; jointly innovate. Consider these to harness a collaborative edge.

Structuring large deals is a team effort that often requires a village to support and strategize effectively. My firsthand experience in numerous scenarios has shown that involving various partners, each leveraging their strengths, is vital to meeting and exceeding customer requirements. This collaborative approach creates additional channels for sharing knowledge, educating the customer, and crafting comprehensive, future-focused solutions jointly.

Examining the ecosystem with the Five Forces framework also presents innovative opportunities. Amazon observed value misalignment in the e-book ecosystem (publishers and authors), so they created a closed platform (Kindle) to assuage the concerns of authors by offering fair profit sharing. They identified what was missing in the ecosystem and reallocated value from where value is in surplus to where value is in shortage.

The first thing you must do is come up with a strategic plan to identify exactly what partners you need. What you can give in exchange, what expectations you can set, and what contingency scenarios you can create for unforeseen events.