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Why Do we Require Them?
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u es of Environmen  Anysis

The process of environmen  nysis my be divided in o he


foowin four s es:
 ucnnin he environmen o de ec wrnin sins.
 Moni orin specific environmen  rends.
 Forecs in he direc ion of fu ure environmen  chnes.
 Assessin curren nd fu ure environmen  chnes for heir orniz ion
impic ions.

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Environmen  ucnnin
è ucnnin is he process of nyzin he environmen for he
iden ific ion of he fc ors which impc on or hve
impic ions for business.
è uuch fc ors my pper suddeny or over ime.
è Iden ific ion of emerinensuin rends is  cri ic
purpose of scnnin. This is he PROuPECTIVE MODE scnnin
which focuses on iden ifyin indic ors or indic ors of
po en i environmen chnes nd issues.

è ucnnin is hus imed  er in he orniz ion o


po en iy sinificn impinemen before i hs fuy formed
or crys ized or formed.

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Moni orin
¢ En is foow-up or more in-dep h nysis of he
environmen  rends iden ified  he scnnin s e.
¢ More focused nd sys emic hn scnnin.
¢ Purpose is o ssembe sufficien d  nd discern whe her cer in
p erns re emerin.
¢ Ini iy my ook hzy, e., ife s ye chnes ʹ my invove oc ion,
en er inmen , educ ion, e c.
¢ ›  › 
· : 1.A specific p ern of environmen 
p erns o be forecs , 2. Iden ific ion of rends for fur her
moni orin, 3.iden ific ion of p erns requirin fur her scnnin,

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Forecs in
¢ Iden ific ion of fu ure hre s nd oppor uni ies
nd for formu in pns.
¢ Forecs in is concerned wi h deveopmen of
pusibe direc ions, scope, speed, nd in ensi y of
environmen  chne, o y ou evou ionry
p h of n icip ory chne.

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Assessmen
¢ Purpose of environmen  nysis is o ssess he
impc of environmen  fc ors on he
orniz ion͛s business or heir impic ions for
he orniz ion.

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Approches To Environmen  Anysis
There re brody wo pproches o environmen  nysis:
1. Ou side-in (mcro· pproch
2. Inside-ou (micro· pproch
The ou side-in or mcro pproch kes  very brod view of he business
environmen (hence he erm ï  pproch· wi h  on erm
perspec ive nd deveops  ern ive scenrios of he fu ure. The
impic ions of he  ern ive scenrios for he indus ry nd he
orniz ion re drwn up wi h reference o he differen scenrios.
The inside-ou (micro· pproch, which kes  r her nrrow view of he
environmen , forecs s he immedi e fu ure environmen on he bsis of
he onoin environmen  moni orin nd derives he impic ions of i
for he indus ry nd firm ou of i .

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u eps o Deveop ucenrios(uhrivs v͛s·
¢ Iden ify s r eic environmen  issues. Priori ize
¢ ueec pusibe(mos ikey· ones nd possibe vri ions.
¢ Prepre preiminry descrip ions of issues.
¢ Drw ou impic ions for orniz ion.
¢ Deveop de ied ou come of fu ure in he form of scenrios ʹ
wors cse, bes cse, mos ikey cse se of ssump ions.
¢ Discuss wi h op mnemen .
¢ Deveop con inency c ion pns on ech of hese scenrios.

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Techniques For Environmen  Anysis

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uTEPu IN ENVIRONMENTAL FORECAuTING
¢  
   ohnson & ohnson cse(demorphics
ʹ bby food nd bir h r e, microwve oven-UuA
vis-à-vis Indi ʹ pckin of food·.
 Pierce & Robinson Approch
¢ Incude Key Vribes inc. ow probbii y ones. Drop o hers
¢ Disrerd mor diss ers (nuc wr·
¢ Are e when possibe in o ross vribes(compny͛s
over csh fow·
¢ uepr e dependen vribes for fu ure pnnin.
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uTEPu IN ENVIRONMENTAL FORECAuTING
¢ `  iden ific ion of sources of
info, de erminin ypes of inform ion needed o be
coec ed, seec ion of me hods of d  coec ion nd
coec ion of inform ion.
¢  
  dependbii y nd
usefuness depends on he echnique used. A depends
on ccurcy, dur ion, cos , compe ence, in erperson
re ionships be ween d  iver nd  herer.
QUANTITATIVE Vu QUALITATIVE
¢ ›› ! Trends nd vribe chne ʹ so dp
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TYPEu OF FORECAuTING
¢  ! ener economic condi ions, GDP row h r e, per cpi 
income, dis ribu in of income, rends in sec ors nd sub sec ors.
    for pnnins r ey
    ! very usefu for demnd nd ses forecs inmk
s r ey formu ion.
 †  Econome ric Me hods, Time ueries Modes
 †  ! udmen Modes
¢  ! use of uDI(Index·-uoci rends hve  sinificn impic ions
for business s r ey. Time series, econome ric me hods, Dephi Me hod nd
combin ions re used. Aso scenrio buidin.
¢  ! UuuR->CIu, envisionin our own 1991 iberiz ion,
some imes sudden-Nep rue, murder of Kin And Fmiy, Assssin ions.
Hrner͛s Business Risk Index, GCI bsed on eih fc ors by WEF
¢ 
  one of he GCI fc ors is echnooy, TIFAC. Brin
u ormin nd Dephi Me hods used.
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TECHNIQUEu FOR ENVIRONMENTAL FORECAuTING ʹ
Qun i  ive nd Qui  ive
¢    Cus Modes, mu ipe reression nd ime series
¢  " -ps o fu ure ʹ iner nd non iner.
¢  #- >Me hods
 Premisin Me hod
 uys ems Dirm Me hod
 Cri ic ui e Me hod
 The Newspper Hedine Me hod
 Loic Possibii ies Me hod
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¢ $  

¢ #
¢  
 %-QUANT TECH ->sys emicy moni orin of soci,
reu ory nd poi ic chnes h ffec corpor e performnce nd
iden ifyin heir impc on he compny.
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BENEFITuIMPORTANCE of ENVIRONMENTAL ANALYuIu

¢ Awreness of Env-Or inke


¢ Iden ify fu ure hre s nd oppor uni ies
¢ Usefu pic ure emeres of impor n fc ors ffec in business.
¢ Heps unders nd he rnsform ion of indus ry environmen .
¢ Technooic Forecs in ʹ wi indic e fu ure O & T
¢ Heps Iden ific ion of Risks
¢ Prereq for formu ion of rih s r eies ʹ copr, buisness nd
func ion.
¢ Env moni orin heps modify s r s nd when required.
¢ EA keeps mners informed, er nd dynmic.

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LIMITATIONu of ENVIRONMENTAL ANALYuIu

¢ Errors ffec in reibii y of forecs . Errors my


occur in:
 ueec ion of Vribes.
 ueec ion of Func ion Form ʹ inkin dependen nd
independen (predic or· vrs.
 Es im ion of ͚correc ͛ vues of predic or vrs.
¢ uever echniques use opinions of peope nd
my be ffec ed by subec ivi y.

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Epi ome of Environmen  Forecs in

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