ENVIRONMENTAL ANALYSIS

INTRODUCTION

Environmental analysis is defined as a procedure that analyses all internal and external
factors that have an impact on an organization's performance. The internal components
represent the business entity's strengths and weaknesses, while the external components
represent opportunities and dangers from outside the corporation.

To undertake environmental analysis, you'll need a steady supply of relevant data to

determine the best course of action. Strategic planners use the data acquired from the
environmental study to forecast future trends ahead of time. The data can also be utilised to
evaluate the operating environment and set organisational objectives.

It determines whether the organization's goals are really achievable with current techniques.
If present strategies do not allow for the achievement of those objectives, new ones are
established or existing ones are adjusted.

Internally, the environmental analysis' findings are utilised to evaluate employee

performance, customer happiness, maintenance costs, and other factors in order to take
remedial action as needed. Furthermore, external measurements assist in positively
responding to the environment as well as aligning initiatives with the organization's
objectives.

Environmental analysis aids in the early detection of hazards, which aids the organisation in
developing survival measures. Furthermore, it discovers opportunities, such as prospective
clients, new products, segments, and technology, in order to capture the largest proportion of
the market possible.

PROCESS OF ENVIRONMENTAL ANALYSIS

1)Scanning entails acquiring information in order to analyse the environment's characteristics

in terms of ambiguity, complexity, and dynamism. It contains the following items:

Early warning indications of impending environmental changes are identified. Trends and
events serve as indicators.

Changes that are already taking place are detected. They're taking place now.
2)Monitoring entails keeping an eye on environmental trends and occurrences.
Environmental auditing is what it is. Environmental impacts on business performance are
likely to have an impact.

3)Forecasting: This stage predicts what will most likely occur. Its course is laid out in such a
way that it anticipates alterations. This step delivers the following benefits:

In the environment, key forces are at work. They could be political-legal, economic, or social
in nature.

4)This step highlights the most important opportunities and dangers. The competitive position
of a business is assessed in terms of how it compares to other businesses vying for the same
customers' resources.

Opportunities are a good thing, but they come with dangers and damage your competitive
position.

The threat is an undesirable circumstance that strengthens the organization's competitive

position.