End Game Analysis

The “end game” is another word for the industry’s “potential structure.” The “end game” is the equilibrium that the industry is moving towards as predicted by the driving forces. Such an end game would exist in an equilibrium state under the theoretical assumption that there would be no more “competitive disturbances” (e.g., no changes in KFS) but it is never actually reached. The point of the “end game” analysis is that we can see where the industry is headed. If it is favorable, one can augment the driving forces. If it is detrimental action can be taken against the direction.

Methodology

1. Understand present drivers. Study the KSF of the industry by understanding the “where and how to compete.” Understand the structure of the industry via analyses such as substitution, exit and entry barriers, demand and supply economics. Study present trends to identify industry movements.
2. Identify the end game. Synthesize findings about the present drivers of the industry into a unified industry direction. Determine what the industry will look like in 10-20 years given no competitive disturbances. This picture is the end game.
3. Evaluate strategy. Evaluate the end game as either being favorable to the interests of the company or unfavorable. Take action to either make the end game a reality or to change the rules of the game.

Notes

• Is not a predictive technique
• Designed to ask “Is this the direction we want to be moving in?” and “If not, what can we do about it?”
• Assumes that the KFS of an industry will not change
• Assumes industry players are both subject to change as well as drivers of change
• Assumes there will be no competitive disturbances between the present and the envisioned end game

Strengths

• Provides insight into “potential structure” of an industry
• Considers implications of the key success factors
• Provides impetus to shift strategy

Weaknesses

• Hypothetical in nature, as the end game is never actually reached