What is the primary purpose of Porter's Five Forces Model?

The primary purpose of Porter's Five Forces Model is to provide a framework for analyzing a company's competitive environment. This model helps businesses understand the dynamics of their industry by examining five key forces that influence competition: the threat of new entrants, the bargaining power of suppliers, the bargaining power of buyers, the threat of substitute products or services, and the intensity of competitive rivalry. By assessing these forces, organizations can identify their strengths and weaknesses relative to competitors, recognize opportunities for growth, and develop strategies that enhance their competitive advantage in the market.

The other choices presented do not align with the main objective of Porter's model. Measuring employee satisfaction pertains to human resources and organizational behavior, while forecasting financial outcomes is focused on financial analysis and predictive modeling. Guidelines for tax compliance strategies are related to regulatory and legal frameworks, which do not directly connect with competitive market analysis. Therefore, the correct answer emphasizes the importance of understanding competitive forces to inform strategic decision-making in business.