Revisiting Porter’s Five Forces in the Digital Era: Insights from a Systematic Literature Review
Keywords:
Strategic Management, Digital Era, Competitive Advantage, Literature Review, Business EcosystemAbstract
The rapid advancement of digital technologies has fundamentally transformed the competitive landscape, characterized by the emergence of platform-based business models, network effects, and increasingly blurred industry boundaries. In this context, the classical framework of Porter’s Five Forces, introduced by Michael E. Porter, remains widely used to analyze industry structure and competitive intensity. However, its relevance in the digital era has been increasingly questioned. This study aims to critically examine the limitations of Porter’s Five Forces in explaining modern competitive dynamics using a literature review approach. Data were collected from reputable academic sources, including Scopus-indexed international journals, and analyzed through a comparative-critical method. The findings reveal several key limitations of the model, including its static nature, lack of integration of technological and innovation factors, inability to capture platform dynamics and network effects, and its reliance on increasingly irrelevant industry boundary assumptions (Bharadwaj et al., 2013; Jacobides et al., 2018; Teece, 2018). Furthermore, the model tends to emphasize competition over strategic collaboration, which has become a crucial element in the digital economy. This study concludes that while Porter’s Five Forces retains conceptual value as a foundational analytical tool, its standalone application is insufficient to capture the complexity of competition in the digital era. Therefore, integrating this framework with more adaptive and contemporary strategic approaches is essential.
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