Which of the following fundamental insights was provided by Porter's five forces framework from the completion of the Alta Velocidad Española (AVE)?
A) A strong threat of substitutes decreases the rivalry among existing competitors.
B) All the five forces must work together to have a meaningful impact.
C) Any of the five forces on its own, if sufficiently strong, can extract industry profitability.
D) Competition must be defined more narrowly to remain confined to the industry's closest competitors.

Question

Quizplus · Accepted Answer

The AVE example highlights the two fundamental insights provided by Porter's five forces framework. First, competition must be defined more broadly to go beyond direct industry competitors. Second, any of the five forces on its own, if sufficiently strong, can extract industry profitability.

Which of the Following Fundamental Insights Was Provided by Porter's