The Internal

Environment
Analysis
Learning Objectives
At the end of this chapter, the student should be able
to:

1. Describe the elements comprising the internal

envirornment of a company;
2. Explain the importance of producing an internal
environment analysis; and
3. Conduct an internal environment analysis.
The Internal
Environment
• A strategic management analysis is a conducted to provide
In operational planning, it’s essential to
record each team member’s
responsibilities for the fiscal year in
detail. How detailed the plan is will
depend upon the projected timeline for
goal completion and how fast the team
works. For businesses that need to hit
their targets quickly, the plan should be
designed for a six-month timeline. For
long-term goals, operational planning
should be done for the whole fiscal year.
 Now that we’ve covered the
meaning of operational planning,
let’s look at some examples of
operational planning in management
and what they entail.
 Examples of
Operational Planning in
Managment
Production Planning
This type of operational planning in management is
geared towards mapping a business’s output. Here the
focus is primarily on using labor and capital
intelligently to make products that can be sold
profitably. Take, for instance, a frozen yogurt
manufacturer that creates 10 different flavors within
just one facility. Operational planning here will involve
organizing supplies and streamlining production lines,
work shifts and warehouse space to maintain
manageable overhead costs.
Capability Planning
Operational planning is required to identify the
purpose of a business and then create a roadmap for
building on its capabilities.

For example, a private taxi company evaluating its

own business capabilities will devise a plan to
maintain its fleet better and upgrade operations to
enhance the safety of women passengers.
Sales Planning
Operational planning is crucial for matching sales targets with
production capabilities. For instance, if a makeup brand wants to run
a promotional campaign that could grow sales by 150%, only tight
operational planning will be able to determine whether the
company’s factories can boost production to such a degree.

Going over a few key examples of operational planning in

management would be helpful to examine how the process actually
helps. Let’s look at a few benefits of operational planning.
Benefits of
Operational
Planning
 Without operational planning in
management, businesses would run
inefficiently and incur losses. Planned
operations are a company’s lifeblood.
Here are some key benefits of operational
planning.
Provides Clarity
Among other things, operational planning
ensures everyone on the team has a clear
idea about the work to be done on a
monthly, weekly and even daily basis.
This helps maintain focus and increase
efficiency.
 Provides A Roadmap
Achieving long-term goals
becomes much easier with
operational planning.
Productivity increases when team
members have a detailed plan to
follow; this also helps maintain
accountability.
Reduces Delay
With a clearly charted-out path,
employees know how much
ground they have to cover by the
end of each day. This helps them
manage their time better and stay
on schedule, thereby producing
quality and timely work.
Good operational planning benefits organizations greatly.
Harappa’s Rise In An Organization program is designed to help
ambitious professionals become ace planners of operations. Under
the guidance of a stellar faculty that takes you through 17 in-depth
lessons, you’ll learn to inspire trust, lead with influence and
become a reliable team player who gets things done. With the help
of frameworks such as The Trust Equation and The Flywheel
Effect, you’ll develop skills that equip you to manage projects
expertly, adapt to situations instinctively and foster trust.

The Rise In An Organization pathway is the ticket to masterfully

influencing decisions and outcomes and facing challenges head-
on!
15 Examples of
Operations
Planning
 Operations planning is the process of
establishing, expanding or improving the core
day-to-day
processes and practices of a business.
Operations includes everything you need to do
to deliver your
products and services to customers. The
following are illustrative examples of
operations planning.
Business Plans
The operations plan section of a business plan includes details of how
you will make proposed products and services a reality. This tends to
be lightweight but broad and may include elements of human
resources, information technology, manufacturing, supply chain,
distribution and customer service.

For example, an operations plan for an ice cream truck may include
details of how ice cream will be procured, transported, stored and sold.
Go-to-Market
A go-to-market strategy is a plan to launch a new
product or service. This is typically formulated by a
marketing team with the cooperation of operations.

For example, a hotel that launches a new poolside

cafe requires an operations plan to detail how
supplies will be procured, food prepared and
customer service provided.
 Risk Management

Risk management related planning

such as a transportation company that
has a goal to reduce accidents
and incidents with improvements to
its operations and infrastructure.
Budget

Budget planning for an operations team. This includes an capex

budget for the day-to-day costs of
running a business and a capex budget for operations related
investments.

For example, a data center

operations team that prepares an capex budget for running the
facility for a year including elements such as salary, power and
rent. The operations team may also prepare a capex budget to
improve systems , hardware and infrastructure.
 Maintenance
Maintenance planning such as an
energy company that creates a
quarterly maintenance plan for
cleaning and repairing solar panels
and battery installations.
Sales and Operations Planning
Sales and operations planning is the process of aligning
sales forecasts with production.

For example, if the sales team at cookware company

plans a major promotion that will boost sales volumes
by 200% they will first gain the agreement of operations
that the firm’s factories can increase production to this
level.
 Production Planning
Production planning is the process of planning the output of an
organization. This is often focused on
utilizing capital and labor efficiently while producing goods that
can be sold at a profitable level.

For example, a soup manufacturer with one factory and 77

flavors of soup that plans production levels for each flavor. This
requires a plan for organizing resources such as supplies,
production lines, work shifts and warehouse space to achieve low
unit costs.
Projects
Project planning for operations related
projects such as a manufacturing team
that plans a project to replace aging
industrial robots on a production line.
 Improvement
Operations produces a firm’s revenue and often
represents the most costly organizational function. As
such, it tends to be heavily optimized with a process of
measuring things, improving and measuring again. This
is planned in terms of targets for management
accounting metrics in areas such as cost, quality,
business volumes and turnaround time.
Capability Planning
Capability planning is the process of identifying
what your business does and establishing a
roadmap for improving and expanding these
capabilities.

For example, an airline that evaluates its current

business capabilities and establishes a plan to
improve its maintenance and flight operations to
increase safety and reduce delays.
 Quality Management
Quality management is the process of controlling,
measuring and improving the quality of an organizations
processes, products and services. This is typically focused
on operations. Planning for quality management involves
establishing targets for quality metrics and developing
actionable plans to achieve these metrics.

For example, a hotel may have a target to improve customer

satisfaction with improvements to housekeeping services
such as a quality control inspection to ensure rooms are
spotlessly clean.
Asset Management
Asset management is the process of managing assets
both tangible and intangible throughout their lifecycle.

For example, an IT operations team that manages

software assets over a lifecycle of development, launch,
operation and retirement. Planning for asset
management includes maintenance, evaluation of assets
and plans to retire aging assets.
 Procurement
Planning for the identification, selection and
management of suppliers and contractors.

For example, a soup company that plans to

procure 112 ingredients from diverse
suppliers to support planned production
levels.
Supply Chain
Supply chain is the process of moving and
storing supplies and finished products such
as a furniture company that plans
warehousing and transportation for
supplies such as wood and finished
products such as desks.
 Distribution
Distribution is the process of reaching the customer
to deliver your products and services.

For example, a French men’s wear company that

plans to distribute its products in Italy by
establishing partnerships with local retailers.
Distribution is a marketing function that requires
operations support.
Preapred by:
Manalo, Rochelle E.
Piga, Rona Faith D.
Luna, Ma. Pearl Maydelyn E.
Gala, Jovalyn S.
Mantic, Rohan B.