Evaluate Porter's concept of the 'Diamond' as a tool for analysing the Essay

Evaluate Porter's concept of the 'Diamond' as a tool for analysing the competitive advantage of nations, assessing its theoretic - Essay Example Moreover, America succeeded in getting the UN permission in attacking Iraq and Afghanistan as part of war on terror strategies. America was able to convince United Nations on all these issues because of their superior competitive power. Globalization has intensified the competition between nations and organizations because of the huge opportunities available in the international market at present. Competitive power of a nation or organization depends on many parameters. Former Harvard university professor Michael Porter and his associates have identified four different parameters for achieving competitive power which is known as Porter’s diamond model for national competitive advantage. â€Å"Porter's diamond model suggests that there are inherent reasons why some nations, and industries within nations, are more competitive than others on a global scale† (What is Michael Porter's Diamond Model?, 2010). Porter identified; Firm strategy, structure and rivalry, supporting industries, demand and factor conditions as the four major parameters which can affect the competitive power of a nation or a firm (Diamond model-Michael Porter, 2011). He was able to put all these parameters in a diamond shape as illustrated in the diagram given below. This paper analyses various features of diamond model and its role in achieving competitive power. Porter’s Diamond model for national competitive advantage (Martin & Porter, 2000) Strategy, Structure and Rivalry Strategies can make or break a nation. Poor strategies will never help a nation in increasing their competitive power whereas better strategies always helpful increasing the growth or competitive power of a nation. For example, when globalization initially entered the global arena, China distanced themselves from it because of their concerns about some hidden agenda at the back drop of globalization by capitalist countries. China and America were engaged in fierce rivalry before the introduction of gl obalization because of the different political ideologies prevailing in these countries. Most of the American and Chinese strategies before globalization were aimed at destabilization or destruction of their opponent. However, globalization forced them to change their strategies and currently America is one of the largest trading partners of China. Both China and America succeeded in increasing their competitive power in global market because of the changes they implemented in their strategies even though the political system and rivalry remains the same. India is another country which succeeded in achieving better competing power as a result of changes in strategies. In 1990’s India made lot of reformations in the economic circle in order to attract more foreign direct investment. They have made some changes in their foreign polices also in order to gain more competitive power in the global market. Earlier, India was more polarised towards former Soviet Union in strategic an d military cooperation. But India changed their strategies immediately after the destruction of Soviet Union and they established closer ties with Untied States in order to gain more competitive power. India has realized that the political structure in India and America are almost the same and it is easy for them to establish smooth business relationships with America. Thus America became a prominent trade partner for India at present.