4-1 chapter 4 environmental scanning and industry analysis
TRANSCRIPT
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4-1
CHAPTER 4 Environmental Scanning and Industry Analysis
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Environmental Scanning
Societal environment --
–Political-legal forces
–Economic forces
–Sociocultural forces
–Technological forces
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4-3
Societal Environment
Political-legal Forces --
–Allocate power; provide laws and regulations
Economic Forces --
–Regulate exchange of materials, money, energy and information
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4-4
Societal Environment
Sociocultural Forces --
–Regulate values, mores, and customs of society
Technological Forces --
–Generate problem-solving inventions
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Task Environment
Task environment --
–Elements or groups that directly affect a corporation and are affected by it
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Task Environment
Industry Analysis --
–In-depth examination of key factors within a corporation’s task environment
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4-7
Variables in Societal Environment
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4-8
Transformational Sociocultural Trends
8 Current Trends –
–Increasing environmental awareness–Growing health consciousness–Expanding seniors market–Impact of the Generation Y boomlet–Declining mass market–Changing pace and location of life–Changing household composition–Increasing diversity of workforce & market
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Scanning the Task Environment
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4-10
External Strategic Factors
Strategic myopia --
–Willingness to reject unfamiliar as well as negative information
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4-11
Issues Priority Matrix
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Analyzing the Task Environment
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Porter’s Approach to Industry Analysis
Threat of New Entrants –
–Economies of scale–Product differentiation–Capital requirements–Switching costs–Access to distribution channels–Cost disadvantages–Government policy
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Porter’s Approach to Industry Analysis
Rivalry Among Existing Firms –
–Number of competitors–Rate of industry growth–Product or service characteristics–Amount of fixed costs–Capacity–Height of exit barriers–Diversity of rivals
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Porter’s Approach to Industry Analysis
•Threat of Substitute Products or Services
•Bargaining Power of Buyers
•Bargaining Power of Suppliers
•Relative Power of Other Stakeholders
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4-16
Industry Evolution
Fragmented Industry –
–No dominant industry
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Industry Evolution
Consolidated Industry –
–Dominated by a few large firms
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Strategic Groups
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Strategic Types
•Defenders
•Prospectors
•Analyzers
•Reactors
General Types –
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Competitive Intelligence
Called business intelligence
Gathering information on a company’s competitors
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Forecasting
Forecasting Techniques --
–Extrapolation
–Brainstorming
–Expert opinion
–Delphi technique
–Statistical modeling
–Scenario writing
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4-22
Synthesis of External Factors -- EFAS