Significance of Environmental Analysis
SIGNIFICANCE OF ENVIRONMENTAL ANALYSIS
By
Akshay Saxena
Under the Guidance of
Mr. Bhende,
Lecturer in Management,
Hind Seva Parishad’s Public Night Degree College,
Mumbai
CONTENTS
Introduction 3
Meaning & Definition 6
History 7
Importance 8
Types of Business Environments 9
Techniques of Environmental Analysis 11
Swot Analysis 13
Case Study 14
INTRODUCTION
Business Environment
Every business firm or organisation is influenced by the environment it operates in, which is complex and dynamic in nature. Environment refers to all factors, the forces of influence of which have a bearing on functioning of the business. These factors may be internal such as the personnel and internal mechanism of the organisation; or external such as competition, government policies, customer preferences, etc.
Internal factors are controllable in nature. They include human resources, financial strength, marketing resources, physical assets, technological competitiveness, management structure and nature, company image and brand equity, value system, etc. These factors highlight the strengths and weaknesses of the organisation. Weaknesses must be minimized or they may prove fatal to its survival.
External factors are beyond the control of the organisation. They refer to the external environment – Macro-environment (General environment) as well as Micro-environment (Operating environment). Micro-environmental factors tend to have a direct impact on the firm and are more intimately linked with the company than Macro-environmental factors. Micro-environmental factors include customers, competitors, channel intermediaries, suppliers, etc. Macro-environmental factors may be Demographic such as population size and density, literacy rate; Economic such as economic and fiscal policies of government, national and international trade situation, demand and supply
By
Akshay Saxena
Under the Guidance of
Mr. Bhende,
Lecturer in Management,
Hind Seva Parishad’s Public Night Degree College,
Mumbai
CONTENTS
Introduction 3
Meaning & Definition 6
History 7
Importance 8
Types of Business Environments 9
Techniques of Environmental Analysis 11
Swot Analysis 13
Case Study 14
INTRODUCTION
Business Environment
Every business firm or organisation is influenced by the environment it operates in, which is complex and dynamic in nature. Environment refers to all factors, the forces of influence of which have a bearing on functioning of the business. These factors may be internal such as the personnel and internal mechanism of the organisation; or external such as competition, government policies, customer preferences, etc.
Internal factors are controllable in nature. They include human resources, financial strength, marketing resources, physical assets, technological competitiveness, management structure and nature, company image and brand equity, value system, etc. These factors highlight the strengths and weaknesses of the organisation. Weaknesses must be minimized or they may prove fatal to its survival.
External factors are beyond the control of the organisation. They refer to the external environment – Macro-environment (General environment) as well as Micro-environment (Operating environment). Micro-environmental factors tend to have a direct impact on the firm and are more intimately linked with the company than Macro-environmental factors. Micro-environmental factors include customers, competitors, channel intermediaries, suppliers, etc. Macro-environmental factors may be Demographic such as population size and density, literacy rate; Economic such as economic and fiscal policies of government, national and international trade situation, demand and supply