What is the primary purpose of driving forces analysis?

The primary purpose of driving forces analysis is to assess the impact of various external and internal factors on industry attractiveness and the necessary strategic changes that companies must undertake to remain competitive. Driving forces can include technological advancements, regulatory changes, demographic shifts, and economic trends that significantly influence the market environment. By understanding these forces, businesses are better equipped to adapt their strategies to align with current and projected market conditions.

This analysis helps companies identify key trends that may reshape their industry, allowing them to anticipate changes and make informed decisions about resource allocation, product development, and competitive positioning. Ultimately, the goal is to improve long-term performance and ensure that strategies remain relevant in a constantly evolving landscape.