Michael Porter is one of the most respected management gurus in the world. In his seminal classic, Competitive Strategy, Porter enlisted many theories that are taught in business schools all over the world. For Porter, developing a competitive strategy is developing a broad formula for how a business is going to compete, what its goals should be, and what policies would be needed to reach those goals. This article reviews some of the theories from his classic work.

Michael E Porter is one of the leading authorities on competitive strategy and International competitiveness in the world. He is the C Roland Christensen Professor of Business Administration at the Harvard Business School. His book Competitve Strategy is now nearing its 60th printing in English and has been translated into 19 languages. The book has transformed the theory, practice and teaching of business strategy throughout the world.

Porter's book is organized into three parts. Part I presents a general framework for analyzing the structure of an industry and its competitors. The underpinning of this framework is the analysis of the five competitive forces acting on an industry and their strategic implications. These are, threat of new entrants, threat of substitution, bargaining power of buyers, bargaining power of suppliers and rivalry among current competitors.