Kate O. Cereño BSMA-4 AC526 TTH 12:00-1:30 PM
Set 105 Environmental Scanning/Industry Analysis – 1
1. What external environmental variables should be scanned?
Environmental Scanning which refers to possession and utilization of information about occasions, patterns, trends, and relationships within an organization’s internal and external environment, helps in identifying the threats and opportunities in the environment. Internal and External analysis should be considered. In external analysis, three correlated external environmental variables that should be scanned, studied, and analyzed —
* immediate / industry environment
* national environment
* broader ...view middle of the document...
b. Issues Priority Matrix- is a way to identify and analyze developments in the external environment. Managers can use it to decide which environmental trends should be merely scanned (low priority) and which should be monitored as strategic factors (high priority).
c. New Entrants- new comers to an industry. They typically bring new capacity, a desire to gain market share, and substantial resources. In this part, managers look into possible ways on how to prevent new companies to enter in the industry. They set entry barriers.
d. Entry Barrier- this is an obstruction that makes it difficult for a company to enter an industry. Economies of scale, product differentiation, capital requirements, switching costs, access to distribution channels, cost disadvantage independent of size, and government policy are examples of which.
e. Rivalry- is the amount of direct competition in an industry. Managers then identify the factors that intensify the rivalry. These are: number of competitors, rate of industry growth, product or service characteristics, amount of fixed costs, capacity, height of exit...