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Hello
If a question requires evaluating attractiveness of an industry or target company, is it okay to use any model e.g BCG, SAF or Porter’s diamond theory?
GaryThe term “attractiveness of the market” is usually associated with a 5-forces analysis. However, you must always look at the information in the question. So, if suitable information is given, you might be able to see that the market is in decline (perhaps life cycle information had been supplied). Or, if for example, you were told that the economy was forecast to deteriorate (parr of PESTEL) that could be relevant too.
Is it okay to combine models to answer a single question though? e.g.. if there is not enough information in the question to use all the elements of PESTEL, can one conclude the analysis with another relevant model?
Yes. Often a model cannot be used completely. The purpose of, say, PESTEL, is tohelp organise information and your thoughts, so use what you can. Also, a single model might not cope with all the information. So, use an additional one too. Eg PESTEL deals with the macorenvironment, but 5 Forces deals with the competitive environment.
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