environmental analysis anim
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Environmental Analysis
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Features of Environment
Complex/multi-faceted.
Dynamic.
Challenging. Far-reaching impact.
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Features of Environmental Analysis
Holistic exercise.
Exploratory process.
Continuous activity.
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Environmental Scanning:
Factors Events.
Trends.
Issues. Expectations.
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SWOT
Opportunity: A favourable condition in the
organisations environment.
Threat: An unfavourable condition in theorganisations environment.
Strength: Inherent capacity of the
organisation.
Weakness: Inherent limitation of the
organisation.
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Boultons Matrix
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Low
Priority
Low
Priority
To be
WatchedL
Low
Priority
High
Priority
High
PriorityM
Low
Priority
High
PriorityCritical
HPR
OBABILITY
OF
IMPACT
LMHIMPACT ON BUSINESS
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QUEST
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QUEST
QUick Environmental Scanning Technique
Proposed by B. Nanus.
A four-step process using scenario-writingfor scanning the environment and
identifying strategic options.
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QUEST: Steps
Make observations about the major events
and trends in the industry.
Speculate on the important issues thatmight affect the future of the organisation
by scanning the environemnt broadly and
comprehensively.
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QUEST: Steps
Prepare a report summarising the major
issues and their implications, and three to
five scenarios incorporating the major
themes of the discussion.
The report and scenarios are reviewed by a
group of strategists who identify feasible
strategic options to deal with the evolvingenvironment. The options are ranked and
teams are designated to develop strategies.
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Identify
Industry
Trends
ScanEnvironment
Develop
Scenarios
Review
Scenarios
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Extended Threat Opportunity
Profile
(ETOP)
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ETOP
Suggested by Glueck.
Involves dividing the environment into
different sectors. Analysing the impact of each sector on the
organisation.
Dividing each environmental sector intosub-factors.
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ETOP
Describing the impact of each sub-factor
on the organisation in the form of a
statement.
Indicating the nature of the impact
favourable, unfavourable, neutral.
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ETOP
Provides a clear picture of the type of
impact of environmental sectors on the
organisation.
Helps in taking advantage of the threats
and countering the threats.
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A Bicycle Company: ETOP
Industry growth rate is 7-8%/year
For sports cycles, growth rate is 30%
Largely unsaturated demand Technological upgradation of industry in
progress
Import of machinery is simple Mostly ancillaries and associated
companies supply parts and components
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A Bicycle Company: ETOP
Imported raw materials easily available
Growing affluence among urban
consumers Bicycle industry a thrust area for exports
Customer preference for sports cycles
Emerging threat from cheap imports fromChina
Export potential promising
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Food Processing Industry
An Example
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Food Processing Industry:
Opportunities A high demand potential. Rising disposable income.
Nuclear families. Rise in the number of working women.
Shift in Indian eating habits.
Spread of TV as an effective advertisingmedium.
Emergence of a retailing culture.
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Food Processing Industry:
Threats Conservative governmental policies reservation of several items for small scale
sector, over-regulation.
High taxation.
Lack of investment in cold chains cold
storages, refrigerated vehicles.
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