STRATEGIC

ENTREPRENEURSHIP

Chapter 2
FACULTY OF ENTREPRENEURSHIP AND BUSINESS
UNIVERSITI MALAYSIA KELANTAN

Lecturer: Solomon Gbene Zaato (PhD)

ENVIRONMENTAL
SCANNING FOR STRATEGIC
ENTREPRENEURSHIP
Strategic Entrepreneurship and Strategic Management

Source : Wheelen, T. L. and Hunger, J. D. (2000 cited in Kuratko, D. F. & Hodgetts, R. M., 2004: 521).
 NEW PRODUCT AND STRATEGY

Includes:
• New product in an established or new market
• Established product in a new market
• A new organization

Entrepreneurial strategy
• Set of decisions, actions, and reactions that
generate, and exploit, a new entry over time
 NEW PRODUCT AND IDEAS

• Types of ideas that develop based on different ideas

Environmental Scanning for Strategic
Entrepreneurship

Source : Hisrich, R. D., Peters, 2009

 Environmental scanning
 Environmental scanning is one of the components of global environmental analysis.
 Other components are monitoring, environmental forecasting and environment
assessment
 The global environment refers to macro environment which comprises of
industries, markets, companies, clients and competitors.
 Societal Environment, Task Environment and Internal Environment are the
components that are employed in environmental scanning
 External/Societal Environment

 External- refers to factors, forces or situations and events outsides the

organization/business and affects its performance.
 Economic forces, Sociocultural forces, political-legal forces and technological forces
constitute the social environmental element.
 The economic forces encompasses factors such as interest rates, inflation, changes in
disposable income and stock market fluctuation.
 The technological forces concerned on new systems or technical knowledge in the
business that have the ability to influence the overall business performance.
 External/Societal Environment

 The sociocultural forces component focusing on societal and cultural factors such
as values, attitudes, trends, traditions, lifestyles, beliefs, tastes and patterns of
behavior.
 The Political-Legal forces are regulatory and political dispensations of any given
national or state government are determined by the orientations of its ideology.
These political and legal forces shape the profile of your business environment. It is
important to understand these forces and their impact on the performance of your
business to navigate these channels successfully.
 Task Environment (INDUSTRY)
 Task environment (industry) analysis exposes that shareholders, suppliers,
Employees/labor unions, competitors, trade associations, communities, creditors,
customers, special interest group and governments are ten parties influencing the
company performance.
 For instance experts say that by 2050, the number of company’s customer will
increase. This increasing of customer may affect the overall business system in the
organization.
 Besides that, government also play an important role in targeting the growth of the
business. Some laws and legislations may affect the productivity of the company
entirely.
 Internal Environment
 The Internal environment consist of company structure, culture and resources
usually within the entrepreneur/your control.
 The conditions, entities, events, and factors within an organization will influence its
activities and choices, particularly the behavior of the employees.
 Factors that are frequently considered as part of the internal environment include
the organization's mission statement, leadership styles, and its organizational
culture.
 References

 Aashish Mehra, G. S. (2011). Managing rapid growth : How mid caps can leap into the billion
dollar club .
 Kuratko, D. F., & Hodgetts, R. M. (2004). Entrepreneurship: Theory, process, practice. Mason,
Ohio: Thomson/South-Western
 Dollinger, M, J. (2008). “ENTREPRENEURSHIP: Strategies and Resources Fourth Edition”,
Kelley School of Business, Indiana University. MARSH publications, pp. 33-40.
 Drucker, P. F., & Drucker, P. F. (2007). Innovation and entrepreneurship: Practice and
principles. Routledge.
 Hisrich, R. D., Peters, M. P., & Shepherd, D. A. (2009). Entrepreneurship. New York:
McGraw-Hill Higher Education.
 Lieberman, M. B., & Montgomery, D. B. (1988). First ‐mover advantages. Strategic
management journal, 9(S1), 41-58.
 R. Barringer, Duane,(2009).Successfully Launching New Ventures: McGraw-Hill Higher
Education.
 Zimmerer, T., Scarborough, N. M., & Wilson, D. (2002). Essentials of entrepreneurship and
small business management (Vol. 2). Upper Saddle River, NJ: Prentice Hall.