WEEK3

external audit
focuses on identifying and evaluating trends and events beyond the control of a
single firm
reveals key opportunities and threats confronting an organization so that managers
can formulate strategies to take advantage of the opportunities and avoid or reduce the
impact of threats.

WEEK3 1
 External forces can be divided into five broad categories:

PESTEL 分析
the process of performing an external audit
gather competitive intelligence and information about economic, social, cultural,
demographic, environmental, political, governmental, legal, and technological trends.
Information should be assimilated and evaluated
final list of the most important key external factors should be communicated
Key external factors should be
important to achieving long-term and annual objectives
measurable
applicaable to all competing frims

the industrial organization (i/o) input and ouput

external (industry) factors are more important than internal factors in a firm for
achieving competitive advantage.

Firm performance is based more on industry properties

economic of scale

barries to market entry

product diffenerentiation

economy
level of competitiveness

five-force model of compettitin 波特五力模型

WEEK3 2
 Identify key aspects or elements of each competitive force that impact the firm.
Evaluate how strong and important each element is for the firm.

Decide whether the collective strength of the elements is worth the firm entering or
staying in the industry.

Industry Analysis: The External Factor Evaluation (EFE) Matrix

Economic
Social
Cultural
Demographic
Environmental

Political
Governmental
Technological
Competitive
Legal

EFE Matrix Steps

WEEK3 3
 1. List key external factors

2. Weight from 0 to 1

3. Rate effectiveness of current strategies

4. Multiply weight * rating

5. Sum weighted scores

6.

EFE Matrix for a Local Ten-Theater Cinema Complex

Total weighted score of 4.0. Organization response is outstanding to threats and

weaknesses

Total weighted score of 1.0. Firm’s strategies not capitalizing on opportunities or

avoiding threats

WEEK3 4
 Understanding the factors used in the EFE Matrix is more important than the
actual weights and ratings assigned.

Industry Analysis: Competitive Profile Matrix (CPM)

1.Identifies firm’s major competitors and their strengths & weaknesses in relation
to a sample firm’s strategic positions
2.Critical success factors include internal and external issues

WEEK3 5