ADMS 1000 Chapter Notes - Chapter 7: Process Engineering, Product Differentiation, Market Power

• School: York University
• Department: Administrative Studies
• Course: ADMS 1000
• Professor: Peter Modir

Document Summary

This is an inverted u-shaped growth pattern that is seen in almost all industries given a long enough period of observation. The number of organizations rises initially up to a peak, then declines as the industry ages. The industry life-cycle model describes the evolution of the entire product category and its associated industry, not a single product or firm. It divides the industry evolution into four distinct phases: introduction, growth, maturity and decline. The life-cycle phase affects the degree of competition firms face, the type of organizational structure, the kind of strategy used and the appropriate management approached needed to survive and grow. This is the first phase in the industry life-cycle model, where many entrepreneurial firms enter the industry, hoping to emerge as a market leader. New industries tend to be highly fragmented (that is, with many small competitors) and characterized by experimentation with novel technologies and business models.