A porters 5 forces analysis of Wipro Ltd (Indian IT Outsourcing) Essay

A porters 5 forces analysis of Wipro Ltd (Indian IT Outsourcing) - Essay Example The model specifically addresses competition concerns within and without the industry in a bid to evaluate and assess the profitability of firms prior to their competition strategies. The following is an analysis of Wipro Ltd in this regard: Competition is a crucial undertaking for any given business entity. For Wipro Ltd, rivalry pertains to countering forces of advancing technologies from time to time and ensuring that sit meets customer needs as they fall due. In so doing, new and existing firms in the same line of service offering are essential to consider. Wipro Ltd seeks to create customer value that remains competitive and reliable over time in order to keep its business aspect attractive to its customers both in the short run and long run. Entry of new firms in the industry poses threats to the revenue earnings and profitability of Wipro Ltd. Unlike other markets, the information technology is characterized by relatively low barriers to entry. The diversity and dynamism associated with IT services consistently lead to the emergence of new firms. To counter threats of new entrants, the company has diversified its service offering portfolio by establishing Wipro divisions which take advantage of new IT needs in the market. Rival firms offer similar but relatively differentiated IT and consultation services. This gives customers a variety of products and services to choose from. Maintaining high profitability in such an environment requires that the services offered be affordable to the customers. However, it is important that the firm observes its costs of operation in order to strike a balance between pricing and operational costs. To account for this scenario, Wipro Ltd evaluates the IT industry from time to time in order to determine factors that affect consumer behaviour, triggering demand for substitute services. This is a