At first glance the Diamond model only seems to be useful to

At first glance, the Diamond model only seems to be useful to describe a country’s national competitive environment of a firm. Is there any way a firm can use the Diamond model to improve its competitiveness? Give two example of how this might be done.

Solution

The Diamond Model by M. Porter for the competitive advantage of Nations gives a model that helps understand the comparative position of a nation in global competition.

We can take the
example of two industries in INDIA,

1. BPO BUSINESS.

2. KPO BUSINESS.

BPO IS ESTABLISHED AND IS IN THE DEVELOPMENT STAGE.

KPO INDUSTRY IS ON THE THRESHOLD OF GROWTH.

CLUSTER ANALYSIS-

A PASSIVE ANALYSIS OF

1. Land
-available in pleanty.

2. Location
-strategic locations available.

3. Natural resources (minerals, energy)
-other than energy, all other resources are available

4. Labor
-both skilled and unskilled labors are available in plenty.

5. Local market size.
-local market size possesses the potential to absorb any excess production.


THE ACTIVE ANALYSIS OF


1.FACTOR CONDITIONS
-INDIA has established its own essential factors like skilled
resources and technological base for expanding BPOs / KPOs

-INDIA is upgrading resources over time to meet
the demand.

-new innovations has given the
local industry a comparative advantage.

2.DEMAND CONDITIONS
-a more demanding local/ global market has given INDIA
the international and national advantage.

-a strong trend setting local market has enabled local firms anticipate
global trends.

3.RELATED AND SUPPORTING INDUSTRIES.
-local competition leads to innovations and cost effectiveness.

-this also puts pressure on the local suppliers to lift their game.






4.FIRM STRATEGIES , STRUCTURE AND RIVALRY.
-local conditions have impacted various firms strategy.
-local rivalry has forced firms to move beyond primary advantages.
examples include INFOSYS , WIPRO .



5. THE ROLE OF THE GOVERNMENT

-INDIAN GOVERNMENT is encouraging more number of BPOs / KPOs.

-INDIAN GOVERNMENT is helping to create pool of skilled labors.
-INDIAN GOVERNMENT is giving infrastructures to attract
more industries.