Using Porter’s Diamond Model to Assess the Competitiveness of Taiwan’s Solar Photovoltaic Industry

Abstract

In this study, we use six dimensions (i.e., firm strategy; government, structure, and rivalry; demand conditions; chance; factor conditions; and related/supporting industries) based on Porter’s diamond model to identify critical development indicators to enhance the competitiveness of Taiwan’s solar photovoltaic industry. Our proposed industry evaluation model uses the decision-making trial and evaluation laboratory (DEMATEL) technique to establish an influential relationship between indicators, the DEMATEL-based analytic network process to obtain influential weights, and the modified VIšekriterijumsko Kompromisno Rangiranje (VIKOR) method to assess industry development performance gaps. Through this analysis, current industry demands can be clarified, and operations of governments and photovoltaic firms can be improved by limiting developmental gaps and formulating robust policies and strategies. Furthermore, the influential network relationship map and influential weights can help explain the complex assessment system and suggest priorities for industry improvement. The results demonstrate that the six dimensions should be upgraded in the following order of priority: firm strategy; government, structure, and rivalry; demand conditions; chance; factor conditions; and related/supporting industries. We also discuss the implications for photovoltaic firm management.