ZICA CA 3.

3
STRATEGIC BUSINESS ANALYSIS
BY ICPHIRI

LECTURE # 8
ENVIRONMENT ANALYSIS

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 COVERAGE

ANALYSING THE
ENVIRONMENT.
• PESTEL
• PORTERS 5 FORCES

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 JUNE 2018 EXAM Q1

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 DEC 2019 QUESTION

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 QUESTION REQUIREMENTS

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 THE ORGANISATIONAL
ENVIRONMENT

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 Analysis of the macro-environment is commonly based on
breaking it down into a handful of major aspects. Your
syllabus requires you to be familiar with the PESTEL
framework, which is based on six segments.
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 POLITICAL ENVIRONMENT
• Government is responsible for creation of
stable business environment.
• Responsible for Physical, Social and
market infractructure.
• Critical is the impact of political change.
• Assess possibility of change,impact
consquences and coping strategies

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 ECONOMIC ENVIRONMENT
• Current and forecast state of the economy
has an impact on companies in terms of:
– Gross Domestic Product
– Inflation rates
– Interest rates
– Tax levels
– Business cycles

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 SOCIAL CULTURAL
ENVIRONMENT
• Long term social trends and people’s beliefs and
attitudes.
• Demography studies population and population
trends including:
– Growth, Age,Geography, Household and
family structure, social structure, wealth,
• Culture - Beliefs, customs,rituals
• knowledge of social trends and culture is
important to an organisation.

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 TECHNOLOGICAL ENVIRONMENT

• EFFECTS OF NEW TECHNOLOGY:

– New Products and Services.
– Production and Selling methods.
– Market Identification.
– Communication.
– Structures.

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 PHYSICAL ENVIRONMENT
• Sources of Input Resources.
• Sources of logistics.
• Disturbance - Disasters.
• Big issue- environmental protection- green
pressure groups,employees and
legislation

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 THE LEGAL ENVIRONMENT

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 INDUSTRY FACTORS –
PORTERS 5 FORCES
Five competitive forces influence the state of
competition in an industry, and collectively determine
the profit potential of the industry as a whole. (You
must learn these five factors.)
• The threat of new entrants to the industry
• The threat of substitute products or services
• The bargaining power of customers
• The bargaining power of suppliers
• The rivalry amongst current competitors in the
industry
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 PORTERS 5 FORCES

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