What Is Rugman's Critique Of Porters Diamond Model?

1853 words - 7 pages

What is Porter Diamond Model? It was known as a Diamond Model by anyone or public. The diamond model is one of the economic model developed by Porter's in 1990 in his own entitled. 'The Competitive Advantage' of Nation's, where he published herself on his theory. The theory was founded by Michael Porter's that has been used by certain industries only, where it will be more competitive in some specific location. The theory by Michael Porter is why the particular industries become a more competitive in some particular locations. This theory is also very effective in providing healthy competition among the industry right now. This theory also prepared personally by Porter's. It is very important for some industries which they know will be deepened and become more competitive in these locations. This theory plays an important role in criticizing or become one way for the industry to grow their businesses in certain locations. In addition, the diamond model helps to understand the comparison between the position of some countries of the industry in global competition that is very rapid.
The Porter Diamond Model has four stage in their model. Firstly, is factor conditions. This factor is very important in the development of the industry. Secondly, the demand conditions. The conditions request is also important in affecting the demand of either party. Thirdly, related and supporting industries. Support from certain industries also play an important role in the economic growth of advanced and rapidly. Support from any of the related parties could help give ideas can develop a the industry. In this way, an industry would be more effective without any problems. Lastly, firm strategy, structure and rivalry. Firm strategy is also important in the implementation of a firm or company and an organization. In addition, the structure of an organization or a firm also play an important role in providing trust either party against a the industry. Hence, a very healthy competition also help economic growth in the industry's increased demand. All this model important and can be used for major geographic regions.

Hence, there are also have a traditional country for advantages. In that factors for comparative advantages by regions or countries such as a land, the locations, natural resources ( mineral, energy) a labor and lastly the local of population size.
According to Porter's, competitive advantage is very important in a country and nation's. It will provide benefit the country. It can be affected by a government itself.ere is an diamond model , firstly, actor conditions. Factor conditions is more to knowledge and skills o someone or owned by a person. Factor condition is very important factors to human resources knowledge, physical resources and capital resources. The infrastructure is also important in an industry or an organization. For example, a country create something new that involves the labor force, skilled resources in a thing, having more knowledge...

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