. Assume you work in Human Resources as a part of the management team for AAA Transportation in Waukegan, WI, which has recently been acquired. AAA Transportation is an interstate trucking company that specializes in transporting wholesale produce in refrigerated trailers throughout the Midwest. The new owners want to make some sweeping changes in the services offered. One of the things that they would like to do is add delivery of nonperishable products, such as canned foods, to their delivery routes, allowing AAA to expand the area they cover and to provide expanded service to their existing customers. They think that, because many of the routes do not require a full load on the trucks, there is room to add the
However, an incorrect perception in any of the five areas could create a mindset that limits decision-making process (Malone-Kline, 2008). For example, a known weakness in the areas of Buyer Power, Supplier Power or Threat of Substitution could create the mindset of vulnerability to a Threat of New Entry without recognizing that an extremely high cost of entry (hence high risk) places any new entry in a more vulnerable position (Mind Tools, 2011). A large number of suppliers can result in a mindset of relative strength in the area of supplier power, a mental model that could prove disastrous if a sudden shortage occurred (such as was the case when Japanese silicon chip manufacturers closed down after the recent earthquakes, causing a worldwide shortage of certain high quality chips). The inverse could also be true as was the case for Buyer Power in the U.S. housing market when the low buyer power mindset for many was not in line with the sudden drop in housing prices. For many computer manufacturers, a Threat of Substitution position of power mindset resulted in their demise because they did not recognize the fact that the market was oversaturated. A mindset or mental model of weakness in the area of Competitive Rivalry has resulted in many new inventions not being introduced to market when in fact the invention technology was superior to rivals. Apple is a great example of a company that has recently been successful