Modern Business in Comparative Perspective Essay - 5

Modern Business in Comparative Perspective - Essay Example The model has been formulated by Porter with due consideration of trade theories. In this regard, Porter has devised the model based on different factors that include resources, cost and infrastructure among others and accordingly, the model developed is important to have an extensive understanding of competition relating to market segment, product differentiation and technological changes. Porter also recommended that the model would explain about the procedures with the assistance of which organizations are able to perform operations effectively and competitively. In this context, Porter while formulating the model conduct an examination in ten countries such as the US, Germany, Denmark, South Korea, Britain, Italy, Sweden, Switzerland, Japan and Singapore. This type of model helps in recognizing the elements of competitive advantage of the countries. Subsequently, diamond model makes a structure, which determines the rules of competition in a sector and marks the important role to be played for attaining the long-term effectiveness (Bakan & Dogan, 2012). In this regard, the essay intends to explain the concept of Porter’s diamond model and national competitive advantage as well as the key issues and problems in relation to competitive advantage of nations. Porter’s diamond model is a type of economic model, which is established by Michael Porter in the book The Competitive Advantage of Nations, where he explains the reason of competitiveness of particular businesses in specific nations. Porter analyzed and formulated the model based on two parts. Initially, the analysis has been conducted on ten important nations that include the US, Germany, Denmark, South Korea, Britain, Italy, Sweden, Switzerland, Japan and Singapore in order to develop a map based on which organizations can conduct operations for their success. Second analysis is the dynamic process through which competitive advantage can be accomplished.