Professional Documents
Culture Documents
4 Strategic
4 Strategic
Environmental Analysis
• Environmental uncertainty
– The degree of complexity plus the degree of
change that exists in an organization’s external
environment.
• Environmental Scanning
– Monitoring, evaluation and dissemination of
information relevant to the organizational
development of strategy
Environmental
Scanning
Environmental Variables
• Natural Environment
– Physical resources, wildlife, climate – an inherent
part of existence on Earth
• Societal Environment
– Social system including general forces that do not
directly touch on the short-run activities of the
organization but can influence its long-term
decisions.
political-legal , Economic, socio-cultural
technological (PEST) or (STEEP) or (SLEPT)
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4-6
Environmental Variables
• Task environment
– those elements or groups that directly affect a
corporation and, in turn, are affected by it
– government, local communities, suppliers,
competitors, customers, creditors,
employees/labor unions, special-interest
groups, and trade associations
• Industry Analysis
– In-depth examination of key factors within a
corporation’s task environment.
SF1 Slide header has been changed to match the header in the text, which is: STEEP Analysis: Monitoring Trends in the Societal and Natural Environments
The prior header simply repeated the title of the table.
Susie Faries, 30/12/2016
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1-
Table 4-3: Some Important Variables in
International Societal Environments
SOURCES: Developed from Pew Research Center analysis of census bureau population projections (September 3, 2015),
(http://www.people-press.org/2015/09/03/the-whys-and-hows-of-generations-research/generations_2/).
SF2 Header changed to match text content. Prior header simply repeated the title of the table. Reference for source of table added to match text content.
Susie Faries, 30/12/2016
Current Sociocultural Trends
• Increasing environmental awareness
• Growing health consciousness
• Expanding seniors market
• Impact of millennials
• Declining mass market
• Changing pace and location of life
• Changing household composition
• Increasing diversity of workforce and markets
Industry
A group of firms that produces a similar product or
service such as drinks or financial services.
Industry Analysis --
–In-depth examination of key
factors/stakeholders/shareholders/suppliers/custo
mers within a corporation’s task environment
21
Assumptions of Porter’s Model
Depends on:
– Number of competitors more/few competitors - high rivalry
– Rate of industry growth slow growth - high rivalry
– Product or service characteristics undifferentiated/commodities -
high rivalry
–Amount of fixed costs high fixed costs high rivalry
–Height of exit barriers high exit barriers high rivalry
–Diversity of rivals high diversity high rivalry
Rivalry High
Threat of Low
substitutes
Bargaining Rising Medium
Power of
suppliers
Bargaining Rising Medium
Power of
buyers
Threat of High
other
stakeholders
36
Categorizing International Industries
• Multi-domestic industries
– specific to each country or group of countries
• Global Industries
– operate worldwide with multinational
companies making only small adjustments for
country-specific circumstances
• Regional industries
– multinational companies primarily coordinate
their activities within regions
SF3 Suggest cross-impact analysis be eliminated. According to the text: "Other forecasting techniques, such as cross-impact analysis (CIA) and
trend-impact analysis (TIA), have not established themselves successfully as regularly employed tools." This would indicate that CIA and TIA would no
necessarily be categorized as "useful forecasting techniques."
Susie Faries, 30/12/2016
Table 4-5: Synthesis of External Factors—
EFAS