External Environment - The strategic management model shows the external environ ment as consisting of two interactive & interrelated

segments The operating envi ronment & the remote environment. The operating environment consists of the forc es & conditions within specific industry. These forces can be controlled by the firm. Where as remote environment refers to the forces & conditions that are bey ond the control of the firm or firms. A value chain A value chain is a chain of activities for a firm operating in a specific indust ry. The business unit is the appropriate level for construction of a value chain , not the divisional level or corporate level. Products pass through all activit ies of the chain in order, and at each activity the product gains some value. Th e chain of activities gives the products more added value than the sum of the in dependent activities' values. sion, can be used to illustrate the difference of cost and the value chain. The cutting activity may have a low cost, but the acti vity adds much of the value to the end product, since a rough diamond is signifi cantly less valuable than a cut diamond. Typically, the described value chain an d the documentation of processes, assessment and auditing of adherence to the pr ocess routines are at the core of the quality certification of the business, e.g . ISO 9001. Competitor analysis in marketing and strategic management is an assessment of th e strengths and weaknesses of current and potential competitors. This analysis p rovides both an offensive and defensive strategic context to identify opportunit ies and threats. Profiling coalesces all of the relevant sources of competitor a nalysis into one framework in the support of efficient and effective strategy fo rmulation, implementation, monitoring and adjustment.[1] Competitor analysis is an essential component of corporate strategy. It is argue d that most firms do not conduct this type of analysis systematically enough. In stead, many enterprises operate on what is called informal impressions, conjectur es, and intuition gained through the tidbits of information about competitors ev ery manager continually receives. As a result, traditional environmental scanning places many firms at risk of dangerous competitive blindspots due to a lack of robust competitor analysis

Sign up to vote on this title
UsefulNot useful