Friday, September 13, 2019

A porters 5 forces analysis of Shinetech (Chinese IT Outsourcing Essay

A porters 5 forces analysis of Shinetech (Chinese IT Outsourcing company) - Essay Example Rivalry is an inevitable phenomenon in the business environment. Firms operate in a competitive environment, all of them aiming at capturing a sizeable market share that adequately maximizes revenue generation and profitability (Porter, 1979, p.5-8). Shinetech Company is a key global IT industry mover. To counter rivalry issues, the company employs agile thinking in its operations and further undertakes quality assurance in a bid to maintain a competitive advantage over its rivals. The IT industry unlike other industries does not face strict barriers to entry. In major and highly expensive product and service offering situations however, significant entry barriers are experienced. New entrants into the industry reduce marker share ratios and further reduce revenue generation and profitability for other firms. Entry of new firms or establishment of new divisions by existing firms poses survival threats for some firms, while it creates high benefits for others. To remain competitive in this environment, Shinetech Company has developed an in-house programme for its clients, reduced time to the market and adopted greater flexibility in business (O’Shaughnessy, 2006, p.13-17). As a result, the company maintains its market share and continues to capture more even with entry threats. The company enjoys a diversified product and service portfolio for its customers. New business entities keep coming up, a scenario that Shinetech is concerned about. It is understood that customers are rational, and they therefore seek to maximize their utility at the minimum cost possible. This means that they prefer low costs but high product and service quality. Firms on the other seek to sell as much as they can and at the maximum price possible. Shinetech Company is result-oriented, and therefore has a competitive advantage over rival companies. The company’s clientele is primarily global enterprises that demand software

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