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Porter five forces analysis

Situation analysis refers to a collection of methods that managers use to analyze an organization’s internal and external environment to understand the organization’s capabilities, customers, and business environment.[1] The situation analysis consists of several methods of analysis: The 5Cs AnalysisSWOT analysis and Porter five forces analysis.[2] A Marketing Plan is created to guide businesses on how to communicate the benefits of their products to the needs of potential customer. The situation analysis is the second step in the marketing plan and is a critical step in establishing a long term relationship with customers.[3]

Marketing Plan

The situation analysis looks at both the macro-environmental factors that affect many firms within the environment and the micro-environmental factors that specifically affect the firm. The purpose of the situation analysis is to indicate to a company about the organizational and product position, as well as the overall survival of the business, within the environment. Companies must be able to summarize opportunities and problems within the environment so they can understand their capabilities within the market.[4]

5C Analysis

While a situation analysis is often referred to as the “3C analysis“, the extension to the 5c analysis has allowed businesses to gain more information on the internal, macro-environmental and micro-environmental factors within the environment. The 5C analysis is considered the most useful and common way to analyze the market environment, because of the extensive information it provides.[5]