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Analysing external environment opportunities and threats

Avinash Tiwari Chandan Kumar MBA 3rd sem. FMS BHU

Environment
Surroundings, external objects, influences or

circumstances
Characteristics of environment Complex Dynamic Multi-faceted Far-reaching impact

Types of Environment
Internal Environment

(It impact strengths or cause weaknesses)


External Environment

(Provide opportunities or pose threats)

The important external environment forces that

affect product-markets strategy of an organization are 1. Economic 2. Technological 3. Competitive 4. Political 5. Social and cultural

Economic Environment
1. General Size of economy, Income levels, Pattern of income distribution & personal

consumption, Growth & stability patterns, Inflationary trends, Institutional financing system, Price & employment level, Agricultural and industrial production etc.

2. Industrial Assessment of industries the enterprise serves & plan to enter.


Long term growth or decline Stability for demand of product Product life cycle Profitability etc.

3. State of supply of resources for production Capital Labour managers

Technological Environment
It also changes the quality of life

Improves efficiency
Need of R&D dept.

Competitive Environment
Closely allied with economic environment

Scope of competitive rivalry


Market share of the participants in the industry Growth rate of industry General level of profits Cost of entry into and exit from an industry Degree of differentiation Nature of product Bargaining power of supplier & customers

References
Strategic management and business policy by

Azhar Kazmi Management policy and strategic management by R.M.Srivastava

Thank You