Thursday, August 11, 2011

Porter’s 5 forces

So I have had the unique opportunity to interview a few MBAs to recruit for my company in the last few weeks. Being a techie in my jobs before, interviewing was fairly simple. You have a set of your favourite programming related questions that you ask. If the candidate can answer 50% of them, you select her, else bye bye.

Recruiting MBAs however for me has been very difficult so far. You are expected to evaluate their analytical and other MBA skills (read soft skills!). Now these skills are pretty difficult to decipher if you don’t lead the interview properly. Like most of you already know, most “MBA types” are very good at speaking and can very well lead you to their comfort zones in an interview.

Now, as a part of any MBA education, I am sure we go through a dozen or so different frameworks in each subject which aid in analysing or predicting certain factors. So be it Marketing, Finance, Strategy, Operations or Human Resources, there are a set of frameworks that have been defined and widely utilized in each of those streams.

Porter's 5 forces

However, ask any MBA to analyse anything in this big bad world and beyond, the only framework that they somehow end up utilizing is the Porter’s 5 forces (Yeah, I am exaggerating, some do use the SWOT analysis framework as well but that's all). In the last few interviews, I have seen Porter’s 5 forces being used to analyse anything and everything from company profitability, population growth of India, US debt crisis, European debt crisis to the effectiveness of the Lokpal bill. My understanding of the Porter’s 5 forces has been now so screwed up (thanks to the enterprising candidates) that I thought I sit and read the theory again to really understand what it means. Hence this blog.

If there is one thing I realized, I am never gonna use the framework in any interview ever, unless the interviewer specifically asks me to use it!

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