Porter (1980) brought in the I/O pe

Porter (1980) brought in the I/O perspective by claiming that external industrial forces affect the work of managers. Substitute products, customers and suppliers as well as potential and present competitors determine strategic choices. The two 'generic strategies' are differentiation and low-cost. Porter's work was further developed in 1985, with the value-chain model, which focuses on the activities and functions of the firm, the underlying factors that drive cost and differentiation advantages (Hedman and Kalling, 2003).