Using an extended example critically examine whether the sector matrix Essay - 1

Using an extended example critically examine whether the sector matrix framework gives a better strategic understanding of product markets than the concepts of product or comodity chains - Essay Example een dominant concept within theoretical framework of economics as well as strategy studies as different theoretical frameworks such as BCG and Porter’s ideas gave rise to the overall concept of the value chain. However, on a much bigger scale, the idea of value chain encompasses a much larger significance because it interconnects different industries either within the borders or outside the borders of the company. This therefore also means that the global supply chain management is not just a mere concept but a social as well as economic phenomenon. The concept of global commodity chains emphasized on the spatial and territorial dimensions of doing business and is based on the concepts of global chains. A new and more innovative concept is the concept of sector matrix which outlines the interplay of demand and supply forces. By emphasizing the demand distribution and supply interaction, the sector matrix increases the field for visible as it attempts to define much more complicated activities and put more focus on redefining competition not from the perspective of the competing manufacturing systems but from really divergent prospective. Globalization of economic resources of the world have given rise to a new phenomenon where products are hardly produced in the domestic markets as there are innumerable linkages between different players which collectively contribute towards the development of chains which regulate the whole process of manufacturing activity. For example, NIKE outsources almost all of its manufacturing facilities and goods sold in US are made in various countries of the world. Porter’s ideas on the five forces indicate how the firm in a particular industry can gain the competitive advantage. The Porter’s five forces discuss the impact of buyer and suppliers on the given firm as the interaction of both the entities on the firm defines the overall competitive advantage of the firm. What is also however, critical to note that the existing