th

4 year B.M.T
Strategic Mgt
Business section

Environmental scanning and industry Analysis

Ch 2- part 3
Sheet 5

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6)Reltaive power of stakeholders :
The stakholders includes :
 Government  Local communities
 Creditors Trade associations
 Labor union Share holders.
 special interest groups  Complementary.
Complementary : - is a company or an industry whose product works firms product
without the product lose much of its value.
‫ ميتجات علشاٌ تشتغل كويط مزتبطة مبيتجات اخزي‬: ‫امليتجات امللنلة‬
Ex (lecture ) : Hardware , soft ware (Microsoft , Intel(
Note :-
 The stronger the forces are , the more threat it represents for the company
‫العوامل الضابكة كلنا كاىت قوية متجل تَديد‬
 The weaker the force are , the more opportunity it represent for the company
‫وكلنا كاىت ضعيفة متجل فزصة‬

Industry Evolution
1-Fragmented industries :
No firm has large market share and each firm serves only a small piece of the total market in.
‫ اليوجد شزكة واحدة مضيطزة علي الضوق بالتالي كل شزكة ليَا ىضيب حمدد مً الضوق‬: ‫صياعات جمشئة‬
2-consolidated industry ( mature industry ) :
Dominated by a few large firms, each of which struggles to differentiate it's produce
competition.
‫شزكات كبرية وعددٍا قليل لذلم كل شزكة بتحاول تلوٌ متنيشة يف ميتجاتَا عً امليافضني‬
Types of international industry :-
 According to porter, world industries vary On a continuum from multi - domestic to global
 Multidomestic industries :
 Specific to each country OF group of countries.
 MNCs:- able to tailor Its products or services to the very specific needs of consumers In a
particular country or group of countries having similar societal environment
 Such as ((insurance, banking industries)).
‫ٍيا الشزكة بتفضل ميتج طبكا الحتياجات املضتَللني يف كل دولة‬

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 Global industries :
 Operate worldwide with MNCs making only small adjustments for country specific
circumstances.
 MNCs manufacture products or service in various locations throughout the world and sell
them making only minor adjustments.
‫ٍيا الشزكة بتضيع ىفط امليتجات مع وجود تعديالت بضيطة‬
The Factors that tend to determine whether an industry will be multi-domestic
or global are :
1) Pressure for coordination within the MNCs operating in that industry.
2) Pressure for local responsiveness on the part of ‘individual country markets.
3) Regional industries:
 Multinational companies primarily coordinate their activities within regions.
 Think global but act locally ((combine between coordination and local responsiveness)).
‫الشزكات االقلينية سي الشزق االوصط وشزق اوروبا‬
strategic Group
- Set of business units or firms that purse similar strategies with similar resources.
‫طزيكة مً خالهلا بيكدر ىبط علي امليافضني اللي عيدٍه ىفط املوارد وبيضتخدو ىفط االصرتاتيجيات‬
 select two broad characteristics such as price and menu that differentiate the companies
in an industry from one another.
Plot firms, using those two characteristics as the dimension.
 Draw a circle around those companies that are closest to the groups share of total
industry sales.
strategic Types (Miles and snow ) ‫االىواع االصرتا تيجي‬
it refers to the category of firms based on common strategic orientation and a com
structure, culture. and processes consistent with that strategic
it involves 4 Types (Exam Exam Exam )
Defenders :
Are companies with a limited product line that focus on improving efficiency of
that existing operations ُ‫اليوعية دي بريكش علي اللفاءة مً خالل ميتجات‬
 prospectors :
Are companies with fairly broad product lines that focus on product innovation and ma
opportunities - They tend to emphasize creativity over efficiency.
‫ ٍدفَه االبداع واالبتلار يف ميتجاتَه‬: ‫الباحجني عً الجزاء‬

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 Analyzers :
1- Are corporations that operate in at least two different product- market areas, One stable
and variable In stable area - efficiency Is emphasized
2. in variable area:- innovation ts emphasized.
‫اليوعية دي عيدٍا تواسٌ عالي يف شغلَا‬
Reactors :
 are corporation that lack a consistent strategy. structure: culture relationship.
 Their response to environmental pressure tend to be piecemeal strategic change.
‫شزكات ماهلاش تضييف ثابت وكلَا ردور افعال‬

Hyper competition: -
lt refers ta the serves competition (Red Ocean) that exists within the industry.
The competitive advantages !s gained through
a- Knowledge of environment
b- Willingness to take risks
c- Cannibalization of own product.
‫ لو بيئة العنل حجه امليافضة فيَا صزيعة السو الشزكة تلوٌ جاٍشة يف اي وقت الٌ حزكة الضوق صزيعة‬: ‫امليافضة الضزيعة‬
Industry analysis : analyzing the task environment
Key success factors: -
Variables that can significantly affect the overall competitive position of companies within an
industry.
‫عوامل ليَا تأثري قوي علي الوضع التيافضي للشزكة‬
industry Matrix :
summarizes the key success factor within a particular industry
‫مضفوفة الضياعة مزتبطة بعوامل جناح الشزكة‬
Note :-
Companies use the key success factors to Create an industry matrix.
competitive intelligence :
A formal program of gathering information on a company's competitors.
‫ اٌ الشزكة يلوٌ عيدٍا معلومات عً امليافضني بتوعَا‬: ‫الذكاء التيافضي‬

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sources of comeptitive intelligence : ‫الشزكة جتيب املعلومات دي ميني‬
 In formation brokers ‫مساصزة املعلومات‬
 Internet ‫فيُ شزكات بتلوٌ ىاشزة معلوماتَا عً االىرتىت‬
 Industrial espionage.
‫ اٌ الشزكة تبعت موظف مً عيدٍا يف الشزكة امليافضة يعزف االخبار ويوصلَا‬: ‫التجضط الضياعي مجال‬
 Investigatory services ‫خدمات الفحط‬
Competitors ((definition)): -
Organization that offer same, similar or substitute products or services In the business areas
in which a particular company operates.
Forecasting
Environmental scanning provides reasonably hard data on the present situation and current
trends, forecasting are needed to accurately predict whether these trends will continue.
 Forecasting is based on a set of assumptions that may or may not be valid.
 Faulty underlying assumptions are the most frequent cause of forecasting errors
Forecasting techniques
 Extrapolation ts the extension of present trends into the future.
 Brainstorming is a non-quantitative approach that requires simply the presence of people
with some knowledge of the situation to be predicted.
 Expert opinion is a non-quantitative technique in which experts in a particular area
attempt to forecast likely developments.
 Delphi technique in which separated experts independently assess the likelihoods of
specified events
Statistical modeling is a Quantitative technique that attempts to discover causal or at least
explanatory factors that link two of more time series together
scenarios are focused descriptions of other forecasting techniques.

End of ch (2)

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TF
 Key success factors seldom vary from industry to industry.
 An industry matrix summarizes the key success factors within a particular industry.
 Competitive intelligence is an informal program of gathering information on a company's
competitors.
 In hypercompetitive industries, competitive advantage comes from an up-to-date
knowledge of environmental trends and competitive activity coupled with a willingness to
risk a current advantage for a possible new advantage.
 Reactors are companies with a limited product line that focus on improving the efficiency
of their existing operations.
 An industry scenario is a forecasted description of a particular industry's likely future. It is
developed by analyzing the probable impact of future societal forces on key groups in a
particular industry.
Extrapolation rests on the assumption that the world is relatively dynamic and changes
quickly in the short run.
 Multidomestic industries are specific to each country or group of countries.
The only factor used to determine whether an industry will be primarily multidomestic or
primarily global is the pressure for local responsiveness.

 Answer :
1 2 3 4 5 6 7 8 9
F T F T F T F T F

MCQ
1-A company or an industry whose product works well with a firm's product and without
which the product would lose much of its value is considered to be a(n)
A) complementor. B) oligopoly.
C) strategic group. D) industry leader. E) staggered company.
2-A relationship that illustrates the term complementor is
A) Microsoft and Intel. B) General Motors and Ford.
C) Hewlett Packard and Compaq. D) Gateway and Dell.
E) America Online and CompuServe.

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3-In a fragmented industry
A) no firm has large market share.
B) prices drop as new competitors enter the market.
C) economies of scale are used to reduce costs.
D) companies integrate to further reduce costs.
E) all of the above.
4-An industry dominated by a few large firms, all of which struggle with product
differentiation, is known as
A) multidomestic. B) consolidated. C) global.
D) indigenous. E) worldwide.
5-In which type of international industry do corporations tailor their products to the
specific needs of consumers in a particular country?
A) consortium industry B) global industry C) indigenous industry
D) multidomestic industry E) worldwide industry
6-Which type of international industry manufactures and sells the same products with only
minor adjustments made for individual countries around the world?
A) consortium industry B) global industry C) indigenous industry
D) multidomestic industry E) worldwide industry
7-Which of the following is an example of a global industry?
A) retailing B) banking C) tires
D) insurance E) health care
8-What is a set of business units or firms that "pursue similar strategies with similar
resources?"
A) strategic group B) collective collaboration
C) cooperative D) integral association
E) strategic assembly
9-Which of the following is NOT one of the general strategic types?
A) initiators B) reactors C) analyzers
D) prospectors E) defenders
10-Which strategic orientation is demonstrated by companies that have a limited product
line and focuses on improving the efficiency of their existing operations?
A) initiators B) reactors C) analyzers
D) prospectors E) defenders

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11-Companies with fairly broad product lines that focus on product innovations and
market opportunities, reflect which strategic orientation?
A) initiators
B) reactors
C) analyzers
D) prospectors
E) defenders

 Answer :
1 2 3 4 5 6 7 8 9 10 11
A A E B D B C A A E D

Make ur check also:

Parts 1 2 3 4 5
studied

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