Article | Harvard Business Review | March–April 1979

How Competitive Forces Shape Strategy

by M. E. Porter


Many factors determine the nature of competition, including not only rivals, but also the economics of particular industries, new entrants, the bargaining power of customers and suppliers, and the threat of substitute services or products. A strategic plan of action based on this might include: positioning the company so that its capabilities provide the best defense against the competitive forces; influencing the balance of forces through strategic moves; and anticipating shifts in the factors underlying competitive forces. McKinsey Award Winner.

Keywords: Competition; Strategy;


Porter, M. E. "How Competitive Forces Shape Strategy." Harvard Business Review 57, no. 2 (March–April 1979): 137–145.