Environmental Scanning & Monitoring- Techniques

SWOT (Strength-Weakness-Opportunity-Threat)

Identification of threats and Opportunities in the environment (External) and strengths and Weaknesses of the firm (Internal) is the cornerstone of business policy formulation; it is these factors which determine the course of action to ensure the survival and growth of the firm.

PEST Analysis

A scan of the external macro-environment in which the firm operates can be expressed in terms of the following factors:

Political
Economic
Social
Technological

1.Political Factors:-

tax policy
employment laws
environmental regulations
trade restrictions and tariffs
political stability

2.Economic Factors:-

economic growth
interest rates
exchange rates
inflation rate

3.Social Factors:-

health awareness
population growth rate
age distribution
career attitudes
emphasis on safety

4.Technological Factors:-

R&D activity
rate of technological change


Porter’s Approach to Industry Analysis:-

*A corporation is most concerned with the intensity of competition within its industry.
*The level of this intensity is determined by basic competitive forces.
*In scanning its industry, the corporation must assess the importance to its success of each of the six forces.

Competitive Structure of Industries:
*Threat of substitutes.
*Threat of new entrants.
*Rivalry among existing firms.
*Bargaining power of suppliers.
*Bargaining power of buyers.


QUEST
The Quick Environmental Scanning Technique, is a scanning procedure designed to assist executives and planners to keep side by side of change and its implications for the organizational strategies and policies.
QUEST produces a broad and comprehensive analysis of the external environment.