This document discusses environmental analysis and forecasting for businesses. It defines key terms like environment, analysis, and environmental analysis. It explains that environmental analysis scrutinizes external forces impacting a business to make managers aware of threats and opportunities. The stages of environmental analysis are scanning, monitoring, forecasting, and assessing the environment. Scanning identifies trends, monitoring analyzes patterns, forecasting makes projections, and assessing evaluates impacts. The document also outlines approaches, techniques, types, uses and steps of environmental analysis to help organizations understand and plan for their changing external environment.

1. ENVIRONMENTAL ANALYSIS AND FORECASTING
ANJU RAJ S4 MBA, MACFAST COLLEGE, TIRUVALLA

2. Definitions
 Environment: It refers to all external forces
which have the bearing on the functioning of
BUSINESS.
 Analysis: It refers to detailed study or
examination of something in order to understand
more about it.
 Environmental Analysis: Scrutinizing of the
external forces which have the bearing on the
functioning of the BUSINESS..

3. WHY ENVIRONMENTAL ANALYSIS ?
Analysis of the environment makes the
business aware of the threats &
opportunities in the environment.

4. Stages of Environmental Analysis
 Scanning
 Monitoring
 Forecasting
 Assessing

5. Environmental scanning
 ‘the study and interpretation of the political,
economic, social and technological events and
trends which influence a business, an industry or
even a total market’.
 It helps the managers to decide the future path of
the organization.
 Scanning must identify the threats and
opportunities existing in the environment.

6. Environmental monitoring
 Focused & systematic in-depth analysis of
relevant environmental trends.
 Gather data to determine emerging
patterns
 Outputs of monitoring :
 Environmental patterns to be forecast
 Trends for further monitoring
 Patterns requiring further scanning.

7. Environmental forecasting
 Environmental forecasting involves the
development of plausible projections about
the direction, scope, speed, and intensity of
environmental change.
 Estimating the intensity, nature, and timing of
the external forces that may effect
the performance of a firm, disrupt its plans ,
or force a change in its strategies.

8. Environmental assessing
 Assess/Evaluate the impact on
organization's business.
 It involves drawing of possible impacts of
the environmental changes on the
organization.

9. Approaches to environmental analysis
 Inside-out (micro) – narrow view of
environment, forecast the immediate future
environment
 Outside-in (macro) scenario analysis –
broad view of BE, long term perspective,
develop alternative scenarios

10. Steps in environmental forecasting
 Identification of relevant environmental
variables
 Collection of Information
 Selection of Forecasting Technique
 Monitoring

11. Types of forecasting
 Economic Forecast
 Social Forecast
 Political forecast
 Technological forecast

12. Uses of environmental analysis
 The environmental analysis makes one aware of
the environment-organization linkage.
 It helps an organization to identify present and
future, threats and opportunities.
 It helps to understand the transformation of the
industry environment.
 It contributes in identification of risks.
 It helps in formulation of strategies.
 It keeps the manger informed, alert and dynamic.

13. Thank you