ACCA Strategic Professional · Strategic Business Leader · Competitive forces

Harlow Bank considers entering a market where mobile network operators supply the platform on which its banking app runs, and where a leading payments provider's service greatly increases customers' willingness to use banking apps. The CEO says Five Forces shows the supplier power of network operators is high and the market is therefore unattractive. Which response best applies the limitations and the sixth force idea?

The analysis should be extended to include complementors, because the payments provider increases demand for the bank's app, and it should recognise that network operators can be partners as well as powerful suppliers. The adversarial Five Forces reading therefore risks overstating the market's unattractiveness.

1. AAgree: the high supplier power fully determines unattractiveness, so no further analysis is needed
2. BReject Five Forces altogether because it cannot assess suppliers
3. CReplace Five Forces with a PESTEL analysis, because complementors are an internal factor
4. DAdd complementors to the analysis, since the payments provider raises demand for the bank's offering, and recognise that the operators may be both suppliers and potential partners, so the adversarial reading may overstate unattractivenessCorrect