100 Dollars Laptop with the Media Lab of MIT Free Essay Example, 2250 words

SWOT analysis of the company reveals the major strengths and weaknesses of the OLPC that is presented in the tabular form below. The external environment or the macro environment has a strong impact on all activities and strategies of the organization. These factors include political, social, economic, legal, technological and eco-environmental factors. Two models are used to analyze the force and impact of these factors. These two models are called PESTEL Analysis and Porters five forces . An industry s attractiveness is evaluated through Porter s five forces model. According to the model, the forces that affect an industry are the threat of entrants, the threat of substitutes, bargaining power of buyers, bargaining power of suppliers and the level of rivalry among the existing competitors. The evaluation determines the attractiveness or unattractiveness of the industry and also helps in formulating strategies for obtaining a competitive advantage. The attractiveness of an indust ry, in turn, determines the overall profitability of the industry measured through overall return on investment. It requires utilizing the existing industry environment to gain competitive advantage. Out of the five forces, the strongest competitive force indicates the profitability of the industry and forms the most crucial part of strategy formulation. We will write a custom essay sample on 100 Dollars Laptop with the Media Lab of MIT or any topic specifically for you Only $17.96 $11.86/page Buyer power is relatively high because of high price sensitivity, greater buyer volume, minimal product differences and the availability of substitute products. Supplier power is low because the volume is important for suppliers, switching cost of suppliers and firms in the industry is not high and backward integration is more plausible than forwarding integration.