| name | five-forces-pressure-test |
| description | Rates an industry on Porter's Five Forces to judge whether the market is structurally worth competing in, flags dangerous force interactions, and is honest about where the model misleads. Use this skill whenever the user asks how attractive an industry is, says "run Five Forces", "is this a good market to be in", "what's the industry structure", or "how hard is this market". Trigger it whenever the question is about industry attractiveness rather than a company's own position. Do NOT use it to decide whether and how a specific company should enter a market — that is market-entry-analyzer's job. This skill judges the market, not your move.
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Five Forces Pressure Test
Before you decide how to compete in a market, decide whether the market is worth competing in at all.
That is what Five Forces is for. It is an industry-attractiveness tool, not a competitive-strategy
tool. The output tells you whether the economics of a market are structurally good or poor before
anyone picks a position inside it.
The method
For a real industry, search the web for current facts first — concentration, recent entrants and
exits, margin benchmarks, substitute trends — before rating anything. Rating a live market from
memory produces confident fiction.
Think of the industry as a table with five parties, each pulling value toward themselves. Rate each
force and give a one-line reason:
- Rivalry among existing players — how much value gets competed away inside the market.
- Buyer power — how much customers extract.
- Supplier power — how much the upstream extracts.
- Threat of new entrants — whether your position is safe from outside challenge.
- Threat of substitutes — whether the market itself survives in five years.
The best markets have low buyer power, low supplier power, high entry barriers, limited substitutes,
and manageable rivalry. Most are a mix.
Then the move most people miss: read the interactions between forces. High buyer power and high
supplier power at the same time means you are squeezed from both sides, and it won't matter how well
you compete against rivals if the structural economics send margin to customers on one side and
suppliers on the other.
Output format
- Each force: High / Medium / Low, with a one-line reason.
- Interactions: any dangerous combinations called out explicitly.
- Verdict: is this a market worth competing in, and why.
- Where this breaks: a short note (see below) whenever the industry is fast-moving,
platform-shaped, or being reshaped by technology.
If the user's real question is whether their company should enter this market, hand off to
market-entry-analyzer once the industry verdict is in; attractiveness is only its first bucket.
How to run it
Default to producing the assessment: all five forces plus the verdict, always with reasons rather
than bare labels. Switch to coaching when the user signals they want to reason it out: ask them to
rate the forces they know and supply reasons, then challenge weak ratings and surface the
interactions.
Where this breaks
Five Forces is a static snapshot of a stable industry, and it misleads in fast-moving or platform
markets where a sixth factor (complementors, network effects, a platform owner) reshapes the game, or
where today's substitute becomes tomorrow's core market. It also treats industry boundaries as fixed,
which is exactly what disruptors ignore. Always include this caveat when the industry is dynamic, and
don't present a tidy verdict as if the structure were frozen.
Style
Plain language, define any force plainly, no em dashes, short paragraphs. Never use it to pick a
competitive position; that's a different set of tools.
