Enviourmental threat and opportunity profile analysis Millipore example profit impact of market strategies

1. ETOP & PIMS
ANALYSIS

2. Environmental Threat and Opportunity Profile
(ETOP) Analysis
• An environmental threat and opportunity profile is a description of the
structure of external factors.
• Multiple Reasons for an ETOP
1. It helps the organization to identify opportunities and threats
2. Consolidates and strengthens an organization’s position
3. Provides strategists information on which sectors have a favorable impact
on the organization
4. The organization gains knowledge of its standing with respect to its
environment
5. Helps formulate strategies.

3. ETOPANALYSIS
Economic factors: Technological factors:
• General economic
condition.
• Rate of inflation.
• Interest rate/Exchange
rate.
• Source of technology.
• Technological development.
• Impact of technology.

4. Socio cultural factors : Environmental factors:
o Demographic characteristics.
o Social attitudes.
o Education level , awareness, and
consciousness of rights.
o Weather change
o Climatic change.
o Demand related factors.
o Suppliers related factors.
ETOP ANALYSIS

5. ETOP ANALYSIS
Political factors : Legal factors :
o Political system.
o Political structure , its goals
and stability.
o Government policies , degree
of intervention
o Policies related to licensing ,
monopolies.
o Policies related to export and
import.
o Policies related to distribution and
pricing.

6. Example: MILLIPORE

7. MILLIPORE PRODUCT LINE
1. Life science.
2. Drug discovery.
3. Sample preparations.
4. Lab water.
5. Process development.
6. Bio production.
7. Process monitoring.

8. Factors Impact of each Sector
Economic
Technological
Political
Legal
Socio cultural
•Fluctuation in exchange rate
•Increasing rate of inflation
•Worsening economic conditions
Strong R&D program
•Market Leaders
•Better solution providers
No significant change.
Following FCPA (Foreign corrupt practices
act).
•Strict IPR laws - No poaching
•No significance change.
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9. Factors Impact of each sector
Competitive
Demand related
Governmental policies
 Competition particularly from low
priced products .
Downfall in demand
 Containment of rising health-care
cost.
No excise duty only vat for
product manufactured in India.
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10. ETOP for a Motor Bike company:
Environmental Sectors Impact of each sector
Social (↑)
Customer preference for motorbike, which are
fashionable, easy to ride and durable.
Political (→) No significant factor.
Economic (↑)
Growing affluence among urban consumers;
Exports potential high.
Regulatory (↑) Two Wheeler industry a thrust area for exports.
Market (↑)
Industry growth rate is 10 to 12 percent per year,
For motorbike growth rate is 40 percent, largely
Unsaturated demand.
Supplier (↑)
Mostly ancillaries and associated companies supply
parts and components, REP licenses for imported
raw materials available.
Technological (↑)
Technological up gradation of industry in progress.
Import of machinery under OGL list possible.

11. PROFIT IMPACT OF MARKET
STRATEGIES (PIMS)
• According to the Strategic Planning Institute(SPI), the
PIMS is a collection of statistically documented experiences
drawn from thousands of business, designed to help
understand what kind of strategies work best in what kind of
business environment.
• It was developed with the intention of providing empirical
evidence of which business strategies lead to success,
within particular industries.

12. STRATEGIES OF PIMS
• The study identified several strategic variables that
typically influence profitability.
• Some of the most important strategic variables
studied were -:
a) Investment intensity
b) Productivity
c) Market Growth
d) Quality of product or services
e) Innovation
f) Vertical Integration

13. PIMS Cont.
• Interest in PIMS as an analytical approach does not appear very high in
the mid-2000s if recent coverage of the subject in the technical and
business press is any indication. A search of Infotrac brings just a few
references from the 1990s and 1980s. The most recent book on the
subject by Paul W. Farris and Michael J. Moore is largely a look
backward—an attempt to assess the contribution PIMS has made to the
field of management science. Looking forward, the authors analyze
how the PIMS project might be structured if it were launched in the
current era. Another broad study of contemporary marketing by Louis
E. Boone and David L. Kurtz mentions a comprehensive use of PIMS
by the Marketing Science Institute. The MSI study came to the not-so-
startling conclusion that (in Boone's and Kurtz's words) "two of the
most important factors influencing profitability were product quality
and market share."

14. PIMS Cont.
• PIMS was from the outset—and apparently continues as—a
"big company" methodology to measure broad strategies
capable of being captured by statistical measures. The
reliance of this method on concepts (and measurements)
like market share performance and marketing expenditures
seems to make its relevance to small business marginal at
best. Small companies on average find it very difficult even
to guess at their own market shares and only very rarely
engage in the kinds of major marketing efforts associated
with the GEs, IBMs, and Coca-Colas of the world.

15. THANKS