Factors Affecting External

Analysis and Levels of

External Analysis

Presented By:
Della T John
22/MBA/043
Introduction
• External analysis is crucial in strategic management, evaluating
factors beyond the organization's control that impact its
performance and decision-making.
• It helps in identifying opportunities, threats, and trends, enabling
organizations to adapt and thrive in competitive markets.
• Environmental scanning is key for gathering, analyzing, and
interpreting external information to make informed decisions
aligned with long-term goals.
Factors Affecting External Analysis
 Macro Environment Factors

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Economic Socio-Cultural

Macro
Environm Environmental
Political and Legal
ent
Factors

Technological Demographic
 Micro Environment Factors

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Buyer Power Industry Supplier Threat of Threat of

Competition Power Substitutes New
Entrants
 Levels of External Analysis

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Environmental Industry Analysis: Competitive
Analysis: Assesses Analysis:
Evaluates macro- competitive Analyzes strengths,
environmental dynamics, weaknesses, and
Buyer Power Threat of
factors like bargaining power, strategies of
New
economic trends, threats, and competitors to
Entrants
political opportunities formulate effective
landscapes, and within specific responses and
technological industries. maintain
advancements. competitiveness.
Conclusion
• External analysis is essential for organizations to anticipate changes,
capitalize on opportunities, and mitigate risks effectively.
• Environmental scanning, industry analysis, and competitive analysis
are indispensable tools for strategic leaders.
• A comprehensive approach to external analysis empowers
organizations to navigate uncertainties and achieve sustainable
growth and competitive advantage.
Thank You