Michael Eugene Porter (born May 23, 1947) is an American academic known for his theories on economics, business strategy, and social causes. He is the Bishop William Lawrence University Professor at

Harvard Business School Harvard Business School (HBS) is the graduate business school of Harvard University, a private research university in Boston, Massachusetts. It is consistently ranked among the top business schools in the world and offers a large full-time MBA ...

, and he was one of the founders of the consulting firm

The Monitor Group Monitor Deloitte is the multinational strategy consulting practice of Deloitte Consulting. Monitor Deloitte specializes in providing strategy consultation services to the senior management of major organizations and governments. It helps its cli ...

(now part of

Deloitte Deloitte Touche Tohmatsu Limited (), commonly referred to as Deloitte, is an international professional services network headquartered in London, England. Deloitte is the largest professional services network by revenue and number of professio ...

) and FSG, a social impact consultancy. He is credited for creating Porter's five forces analysis, which is instrumental in business strategy development at present. He is generally regarded and hailed as the father of the modern strategy field. He is also regarded as one of the world's most influential thinkers on management and competitiveness as well as one of the most influential business strategists the world has ever seen. He is the most sought after research scholar and his work has been highly recognised by governments, non governmental organisations and universities.

Early life

Michael Porter's father was a civil engineer and Georgia Tech graduate who had gone on to a career as an army officer. Michael Eugene Porter received a BSE with high honors in aerospace and

mechanical engineering Mechanical engineering is the study of physical machines that may involve force and movement. It is an engineering branch that combines engineering physics and mathematics principles with materials science, to design, analyze, manufacture, ...

from

Princeton University Princeton University is a private research university in Princeton, New Jersey. Founded in 1746 in Elizabeth as the College of New Jersey, Princeton is the fourth-oldest institution of higher education in the United States and one of the ...

in 1969, where he graduated first in his class and was elected to

Phi Beta Kappa The Phi Beta Kappa Society () is the oldest academic honor society in the United States, and the most prestigious, due in part to its long history and academic selectivity. Phi Beta Kappa aims to promote and advocate excellence in the liberal ...

and

Tau Beta Pi The Tau Beta Pi Association (commonly Tau Beta Pi, , or TBP) is the oldest engineering honor society and the second oldest collegiate honor society in the United States. It honors engineering students in American universities who have shown a ...

. He received an MBA with high distinction in 1971 from

, where he was a George F. Baker Scholar, and a PhD in business economics from

Harvard University Harvard University is a private Ivy League research university in Cambridge, Massachusetts. Founded in 1636 as Harvard College and named for its first benefactor, the Puritan clergyman John Harvard, it is the oldest institution of highe ...

in 1973. Porter said in an interview that he first became interested in competition through sports. He was on the NCAA championship golf squad at Princeton and also played football, baseball and basketball growing up. Porter credits Harvard professor Roland "Chris" Christensen with inspiring him and encouraging him to speak up during class, hand-writing Porter a note that began: "Mr. Porter, you have a lot to contribute in class and I hope you will." Porter reached the top of the class by the second year at Harvard Business School. At Harvard, Porter took classes in

industrial organization In economics, industrial organization is a field that builds on the theory of the firm by examining the structure of (and, therefore, the boundaries between) firms and markets. Industrial organization adds real-world complications to the perf ...

economics, which attempts to model the effect of competitive forces on industries and their profitability. This study inspired the

Porter five forces analysis Porter's Five Forces Framework is a method of analysing the operating environment of a competition of a business. It draws from industrial organization (IO) economics to derive five forces that determine the competitive intensity and, therefore, ...

framework for analyzing industries.

Career

Michael Porter is the author of 20 books and numerous articles including ''Competitive Strategy'', ''Competitive Advantage'', ''Competitive Advantage of Nations'', and ''On Competition''. A six-time winner of the McKinsey Award for the best ''

Harvard Business Review ''Harvard Business Review'' (''HBR'') is a general management magazine published by Harvard Business Publishing, a wholly owned subsidiary of Harvard University. ''HBR'' is published six times a year and is headquartered in Brighton, M ...

'' article of the year, Professor Porter is the most cited author in business and economics. Porter stated in a 2010 interview: "What I've come to see as probably my greatest gift is the ability to take an extraordinarily complex, integrated, multidimensional problem and get arms around it conceptually in a way that helps, that informs and empowers practitioners to actually do things." Outside In approach also known as Market Based View/Prescriptive approach which falls under the competitive positioning schools of thought are taught through using Porter's Five Forces model, Porter's Generic Strategies and Porter's Value Chain frameworks. During his illustrious career, he has emphasized the fact that strategy should not be merely chosen based on the majority of votes in a popularity contest and instead termed the essence of strategy is about making choices. He has delivered public speaking based on the importance of strategy formulation and has served as a consultant to many governments, NGOs devising strategy formulations.

Competition among nations

Competitive Advantage

Porter wrote "The Competitive Advantage of Nations" in 1990. The book is based on studies of ten nations and argues that a key to national wealth and advantage was the productivity of firms and workers collectively, and that the national and regional environment supports that productivity. He proposed the "diamond" framework, a mutually-reinforcing system of four factors that determine national advantage: factor conditions; demand conditions; related or supporting industries; and firm strategy, structure and rivalry. Information, incentives, and infrastructure were also key to that productivity. During April 2014, Porter discussed how the United States ranks relative to other countries on a comprehensive scorecard called "The Social Progress Index", an effort which he co-authored. This scorecard rated the U.S. on a comprehensive set of metrics; overall, the U.S. placed 16th. Michael Porter defined the two ways in which an organization can achieve competitive advantage over its rivals: cost advantage and differentiation advantage. Cost advantage is when a business provides the same products and services as its competitors, albeit at a lesser cost. Differentiation advantage is when a business provides better products and services as its competitors. In Porter's view, strategic management should be concerned with building and sustaining competitive advantage. He originally developed the Porter's Five Forces in 1979 which is still widely used as a model to analyse the industry and to estimate whether it would be profitable and ideal enough to enter the industry after carefully examining the bargaining power of buyers, bargaining power of suppliers, threat of new entrants, competition among existing firms and threat of substitutes. He first wrote and published about Porter's Five Forces in a 1979 article ''How Competitive Forces Shape Strategy'' and has further expained about the Five Forces in his 1980 article ''Competitive Strategy: Techniques for Analyzing Industries and Competitors.'' Porter introduced the concept of competitive advantage in 1985 which later went onto become one of the key concepts in management science at present. He also published a book titled ''Competitive Advantage: Creating and Sustaining Superior Performance'' in order to explain the concept of competitive advantage and the book which later went onto become a

bestseller A bestseller is a book or other media noted for its top selling status, with bestseller lists published by newspapers, magazines, and book store chains. Some lists are broken down into classifications and specialties (novel, nonfiction book, co ...

also focuses on

value chain A value chain is a progression of activities that a firm operating in a specific industry performs in order to deliver a valuable product (i.e., good and/or service) to the end customer. The concept comes through business management and was f ...

concept.

Value chain

It was Porter who first coined and introduced the concept of value chain analysis which was another groundbreaking idea that changed the dynamics of how business activities are conducted.

Healthcare

Porter has devoted considerable attention to understanding and addressing the pressing problems in health care delivery in the United States and other countries. His book, ''Redefining Health Care'' (written with Elizabeth Teisberg), develops a new strategic framework for transforming the value delivered by the health care system, with implications for providers, health plans, employers, and government, among other actors. The book received the James A. Hamilton award of the American College of Healthcare Executives in 2007 for book of the year. His ''

New England Journal of Medicine ''The New England Journal of Medicine'' (''NEJM'') is a weekly medical journal published by the Massachusetts Medical Society. It is among the most prestigious peer-reviewed medical journals as well as the oldest continuously published one. His ...

'' research article, "A Strategy for Health Care ReformToward a Value-Based System" (July 2009), lays out a health reform strategy for the U.S. His work on health care is being extended to address the problems of health care delivery in developing countries, in collaboration with Dr. Jim Yong Kim, Sachin H. Jain, and others at the

Harvard Medical School Harvard Medical School (HMS) is the graduate medical school of Harvard University and is located in the Longwood Medical Area of Boston, Massachusetts. Founded in 1782, HMS is one of the oldest medical schools in the United States and is cons ...

and

Harvard School of Public Health The Harvard T.H. Chan School of Public Health is the public health school of Harvard University, located in the Longwood Medical Area of Boston, Massachusetts. The school grew out of the Harvard- MIT School for Health Officers, the nation's firs ...

Consulting

In addition to his research, writing, and teaching, Porter serves as an advisor to business, government, and the

social sector The voluntary sector, independent sector, or civic sector is the realm of social activity undertaken by organizations that are non-governmental nonprofit organizations. This sector is also called the third sector, community sector, and nonprofit s ...

. He has served as strategy advisor to numerous leading U.S. and international companies, including

Caterpillar Caterpillars ( ) are the larval stage of members of the order Lepidoptera (the insect order comprising butterflies and moths). As with most common names, the application of the word is arbitrary, since the larvae of sawflies (suborder Sy ...

Procter & Gamble The Procter & Gamble Company (P&G) is an American multinational consumer goods corporation headquartered in Cincinnati, Ohio, founded in 1837 by William Procter and James Gamble. It specializes in a wide range of personal health/consumer he ...

Scotts Miracle-Gro Scotts LawnService was a subdivision of The Scotts Miracle-Gro Company, an American multinational corporation headquartered in Marysville, Ohio. History and overview Scotts LawnService was founded in 1998, with the acquisition of Emerald Green ...

Royal Dutch Shell Shell plc is a British multinational oil and gas company headquartered in London, England. Shell is a public limited company with a primary listing on the London Stock Exchange (LSE) and secondary listings on Euronext Amsterdam and the New ...

, and Taiwan Semiconductor. Professor Porter once served on two public boards of directors, those of

Thermo Fisher Scientific Thermo Fisher Scientific Inc. is an American supplier of scientific instrumentation, reagents and consumables, and software services. Based in Waltham, Massachusetts, Thermo Fisher was formed through the merger of Thermo Electron and Fisher Sc ...

and

Parametric Technology Corporation PTC Inc. (formerly Parametric Technology Corporation) is an American computer software and services company founded in 1985 and headquartered in Boston, Massachusetts. The global technology company has over 6,000 employees across 80 offices in ...

. He also plays an active role in U.S.

economic policy The economy of governments covers the systems for setting levels of taxation, government budgets, the money supply and interest rates as well as the labour market, national ownership, and many other areas of government interventions into the ec ...

, working with the

Executive Branch The Executive, also referred as the Executive branch or Executive power, is the term commonly used to describe that part of government which enforces the law, and has overall responsibility for the governance of a state. In political systems ...

and with

Congress A congress is a formal meeting of the representatives of different countries, constituent states, organizations, trade unions, political parties, or other groups. The term originated in Late Middle English to denote an encounter (meeting of ...

, and has led national economic-strategy programs in numerous countries. he was working with the presidents of

Rwanda Rwanda (; rw, u Rwanda ), officially the Republic of Rwanda, is a landlocked country in the Great Rift Valley of Central Africa, where the African Great Lakes region and Southeast Africa converge. Located a few degrees south of the Equator ...

and

South Korea South Korea, officially the Republic of Korea (ROK), is a country in East Asia, constituting the southern part of the Korea, Korean Peninsula and sharing a Korean Demilitarized Zone, land border with North Korea. Its western border is formed ...

. In 1983, Michael Porter co-founded the

Monitor Group Monitor Deloitte is the multinational strategy consulting practice of Deloitte Consulting. Monitor Deloitte specializes in providing strategy consultation services to the senior management of major organizations and governments. It helps its clie ...

, a strategy-consulting firm. Deloitte Consulting acquired the Monitor Group in 2013 through a structured

bankruptcy proceeding Bankruptcy is a legal process through which people or other entities who cannot repay debts to creditors may seek relief from some or all of their debts. In most jurisdictions, bankruptcy is imposed by a court order, often initiated by the debt ...

Non-profit

Michael Porter has founded four major non-profit organizations: Initiative for a Competitive Inner City – ICIC, founded in 1994, and which he still chairs, which addresses economic development in distressed urban communities; the Center for Effective Philanthropy, which creates rigorous tools for measuring foundation effectiveness; FSG Social Impact Advisors, a leading non-profit strategy firm which he co-founded with Mark Kramer, serving NGOs, corporations, and foundations in the area of creating social value; and International Consortium for Health Outcomes Measurements (ICHOM), which he co-founded in 2012 with Stefan Larsson and Martin Ingvar. ICHOM supports the key strategic agenda items in Porter's Value-Based Health Care Delivery framework by working with patients and leading healthcare providers to create a global standard for measuring health outcomes. He also currently serves on the Board of Trustees of

Honors and awards

In 2000, Michael Porter was appointed Bishop William Lawrence

University Professor Professor (commonly abbreviated as Prof.) is an academic rank at universities and other post-secondary education and research institutions in most countries. Literally, ''professor'' derives from Latin as a "person who professes". Professor ...

Harvard Harvard University is a private Ivy League research university in Cambridge, Massachusetts. Founded in 1636 as Harvard College and named for its first benefactor, the Puritan clergyman John Harvard, it is the oldest institution of higher le ...

, the university's highest recognition awarded to Harvard faculty.

Criticisms

Porter's work has received critique from peers within academia for inconsistent logical argument in his assertions. Porter's conclusions have been critiqued as "lacking in empirical support" and as "justified with selective case studies". In these analysis of his work it is asserted that Porter fails to credit original creators of his postulates originating from pure microeconomic theory.

Legacy

He has written numerous books on modern competitive strategy for business. His research work in strategic management has often been an important subject matter as far as the university system is concerned. His concepts and theories with regards to strategic management are given utmost priority in universities and colleges where his theories such as Porter's Five Forces, Porter's Diamond model, Porter's Generic Strategies and Porter's Value Chain are taught by lecturers and professors to the students. The assignments delegated to students often test how Porter's Five Forces and Porter's Diamond model can be used practically in making effective decisions when implementing appropriate and well thought out strategies.

Work

Competitive strategy

* Porter, M.E. (1979) "How Competitive Forces Shape Strategy", ''Harvard Business Review'', March/April 1979. * Porter, M.E. (1980) ''Competitive Strategy'', Free Press, New York, 1980. The book was voted the ninth most influential management book of the 20th century in a poll of the Fellows of the

Academy of Management The Academy of Management is a professional association for scholars of management and organizations that was established in 1936. It publishes several academic journals, organizes conferences, and provides others forums for management professo ...

. * Porter, M.E. (1985) ''Competitive Advantage'', Free Press, New York, 1985. * Porter, M.E. (ed.) (1986) ''Competition in Global Industries'', Harvard Business School Press, Boston, 1986. * Porter, M.E. (1987) "From Competitive Advantage to Corporate Strategy", ''Harvard Business Review'', May/June 1987, pp. 43–59. * Porter, M.E. (1996) "What is Strategy", ''

'', Nov/Dec 1996. * Porter, (2017
"Michael Porter on Creating Competitive Advantage for Yourself"
''HBR Ascend * Porter, M.E. (1998) ''On Competition'', Boston: Harvard Business School, 1998. * Porter, M.E. (1990, 1998) ''The Competitive Advantage of Nations,'' Free Press, New York, 1990. * Porter, M.E. (1991) "Towards a Dynamic Theory of Strategy", ''

Strategic Management Journal The Strategic Management Society (SMS) is a professional society for the advancement of strategic management. The society consists of nearly 3,000 members representing various backgrounds and perspectives from more than eighty different countries. ...

'', 12 (Winter Special Issue), pp. 95–117. http://onlinelibrary.wiley.com/doi/10.1002/smj.4250121008/abstract * McGahan, A.M. & Porter, M.E. Porter. (1997) "How Much Does Industry Matter, Really?" ''

'', 18 (Summer Special Issue), pp. 15–30. http://onlinelibrary.wiley.com/doi/10.1002/(SICI)1097-0266(199707)18:1%2B%3C15::AID-SMJ916%3E3.0.CO;2-1/abstract * Porter, M.E. (2001) "Strategy and the Internet", ''

'', March 2001, pp. 62–78. * Porter, M.E. & Kramer, M.R. (2006) "Strategy and Society: The Link Between Competitive Advantage and Corporate Social Responsibility", ''Harvard Business Review'', December 2069, pp. 78–92. * Porter, M.E. (2008) "The Five Competitive Forces That Shape Strategy", ''Harvard Business Review'', January 2008, pp. 79–93. * Porter, M.E. & Kramer, M.R. (2011) " Creating Shared Value", ''Harvard Business Review,'' Jan/Feb 2011, Vol. 89 Issue 1/2, pp. 62–77 * Porter, M.E. & Heppelmann, J.E. (2014
"How Smart, Connected Products are Transforming Competition"
''Harvard Business Review,'' November 2014, pp. 65–88 * Porter, M.E. & Heppelmann, J.E. (2015)
How Smart, Connected Products are Transforming Companies"
''Harvard Business Review,'' October 2015, pp. 97–114 * Porter, M.E. & Heppelmann, J.E. (2017)
Why Every Organization Needs an Augmented Reality Strategy"
''Harvard Business Review,'' November 2017, pp. 46–62

US political competitiveness

* Gehl, K.M. & Porter, M.E. (2017)
Why Competition in the Politics Industry is Failing America
, ''Harvard Business School'', September 2017.

Domestic health care

* Porter, M.E. & Teisberg, E.O. (2006) ''Redefining Health Care: Creating Value-Based Competition On Results'', Harvard Business School Press, 2006. * Berwick, DM, Jain SH, and Porter ME
"Clinical Registries: The Opportunity For The Nation."
Health Affairs Blogs, May 2011.

Global health care

* Jain SH, Weintraub R, Rhatigan J, Porter ME, Kim JY. "Delivering Global Health". ''Student British Medical Journal'' 2008; 16:27. * Kim JY, Rhatigan J, Jain SH, Weintraub R, Porter ME. "From a declaration of values to the creation of value in global health: a report from Harvard University's Global Health Delivery Project". ''Global Public Health''. 2010 Mar; 5(2):181–88. * Rhatigan, Joseph, Sachin H Jain, Joia S. Mukherjee, and Michael E. Porter. "Applying the Care Delivery Value Chain: HIV/AIDS Care in Resource Poor Settings." ''Harvard Business School Working Paper'', No. 09-093, February 2009.

Books and commentaries

* ''Understanding Michael Porter: The Essential Guide to Competition and Strategy''. Magretta, Joan. Boston: Harvard Business School Publishing, 2012. * '' The Lords of Strategy: The Secret Intellectual History of the New Corporate World.'' Kiechel, Walter III. Harvard Business School Publishing, Boston, 2010. * ''The Porter Hypothesis After 20 Years: How Can Environmental Regulation Enhance Innovation and Competitiveness?'' Stefan Ambec, Mark A. Cohen, Stewart Elgie, and Paul Lanoie. Resources for the Future Discussion Paper, Washington DC, 2011. * ''Well-Designed Environmental Regulations will Strengthen Companies' Competitiveness: Reviewing the Porter Hypothesis''. Mitsuhashi Tadahiro (ed.) Japan, 2008. * ''From Adam Smith to Michael Porter: Evolution of Competitiveness Theory y.'' Cho, Dong-Sung Cho and Hwy-Chang Moon. Asia-Pacific Business Series, Korea, 2000. * “Retrospective: Michael Porter's Competitive Strategy.” ''Academy of Management Executive,'' May 2002, Vol. 16, No. 2 * ''Perspectives on Strategy: Contributions of Michael E. Porter'', F.A.J. van den Bosch and A.P. de Man (eds.), Kluwer Academic Publishers, Dordrecht, The Netherlands, 1997. * ''O Projecto Porter: A aplicação a Portugal 1993/94''. Lisbon, Portugal: Ministério da Indústria e Energia, May 1995. * ''Sölvell, Ö. (2015), The Competitive Advantage of Nations 25 years – opening up new perspectives on competitiveness. Competitiveness Review, Vol. 25 No. 5, pp. 471-481. https://doi.org/10.1108/CR-07-2015-0068.

References

External links

* Michael Porter currently leads th
Institute for Strategy and Competitiveness at Harvard Business School
– Accessed October 15, 2012
Porter proposals for reforming the delivery of health care
– Accessed October 15, 2012
Biography at Harvard Business School Faculty Pages
– Accessed October 15, 2012

* {{DEFAULTSORT:Porter, Michael Michael Porter Innovation economists American business theorists American aerospace engineers American educators American academics American economists Writers from Ann Arbor, Michigan Princeton University alumni Harvard Business School alumni 1947 births Living people Harvard Business School faculty Marketing theorists Business educators