Porter’s Five Forces for the strategic value of virtual reality technology in the civil and building construction industry

Porter’s Five Forces for the strategic value of
virtual reality technology in the civil and building
construction industry

Porter’s Five Forces
Analyzes the
level of
competition
within the
industry (Kreps,
D.M., 2019)
Derives
Competitive
intensity and
attractiveness of
an industry
Provides standalone
analysis with
oversimplification of
industry value chain
Comprises of
forces impacting
a business
5 forces can be
sub-divided for
targeted analysis
(Kreps, D.M.,
2019)

Porter’s Five Forces Model used in Construction
industry
• Bargaining
power of
suppliers
and
bargaining
power of
buyers
• The threat of
substitutes (Burns
and Dewhurst,
2016)
• The threat
of market
entry (Burns
and
Dewhurst,
2016)
• Rivalry among
existing companies
Competitors
are roughly
balanced,
exit barriers
are high,
fixed costs
are high
Cost of
entries are
low,
differentiatio
n is low, gaps
in the market
Buyers are
more
concentrated
than sellers,
buyer
switching
costs are low,
cost of
switching of
suppliers are
high
Make existing
technologies
redundant,
incremental
product
improvement