Environmental Analysis

So, it says here that, "it is described as the process which examines all the components, internal or
external, that have an influence on the performance of the organization.

It is used heavily used, in decision-making process, as it helps align business strategies with what is
currently going on in the environment.

We conduct an environmental analysis to identify and analyze all the external and internal forces
affecting the business performance.

So, the business environment is composed of the:

The Macroenvironment and The Microenvironment.

So, the Macroenvironment,

it focuses on the external forces of a firm or company that directly or indirectly affect the
microenvironment.

While the microenvironment,

the environment which is in direct contact with company, It is a collection of forces or factors that are
close to the organization and can influence the performance as well as the day-to-day activities

STEEPLED ANALYSIS

It is a PESTEL Analysis that is further extended to STEEPLED.

The S stands for social,

These include the attitudes, values, and lifestyles that influence the products

people buy, the prices paid for products, the effectiveness of specific promotions

These are the:

The T stands for Technological,

The firm is impacted by the current, previous, and future state of

technology. It must take advantage of the technology-related opportunities

These are the:

The E stands for Economic,

The purchasing power and spending patterns of consumers are considered when analyzing these forces.

These are the:

The E stands for Environmental,

This includes the physical and natural resources that are needed as
inputs by the firm, which affects its activities/operations.

These are the:

The P stands for Political,

This includes the laws which the firm must pay attention to and the
scope of impact of the government and its policies.

These are the:

The L stands for Legal,

Somewhat like political, this includes legislative bills passed within the
area or location the firm operates

These are the:

The E stands for Ethical,

This force includes social values, which provide the basis of what is right
or wrong, that shape business behavior

These are the:

The D stands for Demographic,

This force includes people's vital statistics, such as age, race, and
ethnicity, and location, as consumer buying behavior and demographic
characteristics

These are the:

SWOT ANALYSIS

It is the process of identifying internal strengths (S) and weaknesses (W) and examining external
opportunities (O) and threats (T).

The firm's strengths are its internal capabilities, resources, and positive situational factors that help
serve its customers and achieve its objectives.

The firm's weaknesses are its internal limitations and negative situational factors that interfere with
its performance.

Opportunities refer to the favorable forces or trends in the external environment that the company
may be able to exploit to its advantage.

Threats refer to the unfavorable external forces or trends that may present challenges to performance

Entrepreneurs consider how to reduce the amount of harm or loss. They recognize chances that are
helpful to the company and must be taken advantage of. To successfully identify the firm's competitive
strengths and shortcomings, an analysis of the firm's microenvironment is undertaken. The results of the
investigation are used to develop effective tactics.