Professional Documents
Culture Documents
Analysis
Introduction
Meaning:
It is the process of monitoring the events and
evaluating trends in the environment, to identify
both present and future opportunities and threats
that may influence the firm’s ability to reach its
goals.
Strategists need to analyze a variety of different
components of the environment.
Importance of
Environmental analysis
It helps to perceive opportunities that might be
explored and threats that need to be contained.
It provides information on the nature of
competition as a step to develop competitive
advantages and
It provides avenues for productive cooperation
with other organizations.
To Sum up…….
Government stability
Political values and beliefs shaping policies
Regulations towards trade and global business
Taxation policies
Priorities in social sector
Attitude towards foreign companies
Economic factors
Biotechnology
Process innovation
Digital revolution
Government spending on research
Government and industry focus on technological
effort
New discoveries/development
Speed of technology transfer
Robotics
Satellite communications
Nano-technology
Legal forces
Monopolies legislation
Employment law
Health and safety law
Product safety
Licensing policies
Quota restrictions
Forex regulations
FDI
Ecological forces
Air pollution
Noise pollution
Water pollution
Soil pollution
Business are now being held responsible for
eliminating the toxic by products and cleaning
up the environmental damage
Components of External
Environment
Macro environment
Operating Evironment/Task Envt/Relevant Envt
Industry and Competitive Environment
Operating Envt:
Suppliers
Customers
Competitors
Financial Institutions
Marketing intermediaries(Distributors and retailers)
Regulatory authorities
Creditors
Industry and Competitive
Envt
An Industry is a group of firms producing a similar
product or services.
Structure and characteristics of the industry in which
a firm operates, and the nature of competitive
forces operating in that industry.