The document discusses analyzing a company's business environment which includes internal and external factors. The internal environment includes value systems, objectives, management structure, resources, and company image. The external environment includes the microenvironment of suppliers, customers, competitors, and publics, as well as the macroenvironment of demographic, economic, natural, technological, political, and socio-cultural forces. Environmental analysis is the first step of strategic management to determine opportunities and threats facing a company.

1. ENVIRONMENTAL ANALYSISSHAMEER P HFUS 100603S2 TECHNOLOGY MANAGEMENT

2. INTRODUCTIONBusiness decisions are influenced by two sets of factors

3. Internal factors (The Internal Environment

4. External Factors( The External Environment)

5. Business Environment presents two challenges to the enterprise

6. The challenge to combat the environmental threats

7. Exploit the business opportunities

8. Environmental Analysis is one of the first steps in Strategic Managementdefinition“The process by which strategists monitor the economic, governmental/legal, market/competitive, supplier/technological, geographic and social settings to determine opportunities and threats to their firms”

9. “Environmental diagnosis consists of managerial decisions made by analysing the significance of data (opportunities and threats) of the environmental analysis”Environmental Scanning is the monitoring, evaluating and disseminating of information from the external and internal environments to key people within the corporation.A corporation uses this tool to avoid strategic surprise and to ensure its long-term health.

10. TYPES OF ENVIRONMENTINTERNAL ENVIRONMENTEXTERNAL ENVIRONMENTBUSINESS DECISIONINTERNAL FACTORSEXTERNAL FACTORS

11. INTERNAL ENVIRONMENTImportant internal factors are1) Value SystemThe value system of founders and those at the helm of affairs has important bearing on the choice of business, the mission and objectives of the organization, business policies and practices.2) Mission and ObjectivesThe business domain of the company , priorities , direction of development, business philosophy, business policy etc. are guided by the mission and objectives of the company

12. INTERNAL ENVIRONMENT3) Management Structure and NatureThe organizational structure, the composition of the Board of Directors, extent of professionalization of management etc. are important factors influencing business decisions.4) Internal Power RelationshipFactors like the amount of support the top management enjoys from lower levels and workers, share holders and Board of Directors have important influence on the decisions and their implementation.The relationship between the members of Board of Directors is also a critical factor.

13. INTERNAL ENVIRONMENT5) Human ResourcesThe characteristics of the human resources like skill, quality, morale, commitment, attitudes etc. could contribute to the strength and weakness of the organization.The involvement, initiative etc. of the people at different levels may vary from organization to organization.6) Company Image and Brand EquityThe image of the company matters while raising finance, forming joint ventures or other alliances, soliciting market intermediaries, entering purchase or sale contracts , launching new products etc.

14. INTERNAL ENVIRONMENTOTHER FACTORSPhysical Assets and FacilitiesR&D and Technological CapabilitiesMarketing ResourcesFinancial Factors

15. EXTERNAL ENVIRONMENTTwo TypesMicro EnvironmentConsists of actors in the company’s immediate environment, that affects the performance of the company.Macro EnvironmentConsists of larger societal forces that affect all the actors in company’s micro environment.

16. MICROENVIRONMENTAlso known as task environment and operating environment

17. Include

18. The suppliers

19. Marketing intermediaries

20. Competitors

21. Customers

22. Publics

23. More intimately linked with the company than macro factors

24. The micro forces need not necessarily affect all the firms in a particular industry in the same way.

25. Some of the micro factors are particular to a firmsuppliersThose who supply the inputs to the company.

26. Source/Sources should be Reliable

27. Uncertainty regarding the supply or other supply constraints compel companies to maintain high inventories causing cost increases.

28. Very risky to depend on a single supplier

29. The purchasing department should “market” itself to suppliers, to obtain favourable treatment during the periods of shortages.customersMajor task of business is to create and sustain customers

30. Different categories of consumers

31. Individuals

32. Households