Industry And External Environment Analysis

3196 words - 13 pages

Introduction
Companies always operate in a certain environment; the formulation and implementation of business strategy are also restricted by the particular environmental factors. (Osborn & Hunt 1974) In other words, environment decides the enterprises’ strategy, decisions making, organizational structure and management styles. The environmental awareness has become the starting point of the environment analysis. (Sethi 1979) In general, the corporate strategy has two environment factors to consider, internal and external environments. Furthermore, because the influence degrees are different, the outside environments divide into the macro environment and industry environment. The productivity and operation of modern enterprises have been increasing impact from the external environment. (Osborn & Hunt 1974)
The strategic management for the organization need has an overall and objectives analysis about the change of the external environment, based the research result to set up the organizational goals and strategy plans. The enterprise and its external operation conditions are in an interaction and interrelated relationship.(Osborn & Hunt 1974) The purpose of study on the peripheral environment is supporting a chance to the organizations to finger out the possible developing opportunity and potential threat, use them to be the conditions and limitations to develop the business strategy. (Sethi 1979)
There have a close contact between business and environment. On the one hand, the environment is the basis for enterprise survival, the elements the business needs all obtained from the external environments, such as human resource, materials, energy, capital, technology, information, etc. Meanwhile, the company's products must be marketed through the external market. On the other hand, the company is a kind of dynamic social organization, it is not only been dictated by the environment, but also be adapted to the environment and impact on it, promoting social progress and economic prosperity. (Sethi 1979) So, the companies must analysis the environment and adapt to being survive and development.
Generally, corporations divide their macro environment into four main pieces to analysis; they are Politics, Economics, Social and Technology. It called PEST analysis, firms through indentifies the change of PEST factors to effect on their organizational strategic managements.
Michael Porter’s Five Forces Model provides a healthy and time-tested framework for analysing the industry environments, reflected in the strength of the five forces. (Porter 1980) This framework provides a basis for firms to recognize the opportunities and threats. To analysis these five forces determines the ultimate profit potential in an industry, where profit is measured in terms of long term returns on capital invested (Porter 1980).
Background information
Subscription television in Australia
In the last two decades, subscription television has played an increasingly...

Find Another Essay On Industry and External Environment Analysis

Qantas International: Analysis of the External Environment

2163 words - 9 pages the decline, with December 2013 passenger utilisation being 80.2%, a fall from 82.4% at the same time the previous year (BITRE, 2014). The independent aviation market analysis organisation CAPA – Centre for Aviation (CAPA) published industry wide profit margins between 2.1% and 2.9% in 2012 and 2103, however, the International Air Transport Association (IATA) forecasts that profit margins will soar on the back of cost cutting and increased

Analysis of the External Environment of Business

1663 words - 7 pages Analysis of the External Environment of Business A ‘business' is commonly defined as an organisation which provides goods or services in addition to transforming input into output. Its objectives can either be profitable or non-profitable. One of the main requirements that must be fulfilled for a business to exist is that it must act and react to activities and occurrences beyond that of the organisation. These factors that happen outside of

Critical Analysis of Internal Resources and External Environment of Wal-Mart

922 words - 4 pages Critical Analysis of Internal Resources of Wal-Mart and External Environment. External Environment We have used Porter’s five forces on the discount retail industry to understand external environment(Porter, Michael E., Competitive Strategy(1988). 1. Threat of new entrants: Low a. Highly price competitive nature of the discount retail industry with already established players vying for market shares forbids new entrants. High entry barriers

Environment and Industry

680 words - 3 pages the profits. In order to avoid this situation, people should attach importance to environmental stewardship more than industrialism and progress. Works Cited 20th Anniversary of World's Worst Industrial Disaster, Simi Chakrabarti, 3 December, 2004 Industry and Environment, EUROPA > Summaries of EU legislation > Enterprise > Interaction between enterprise policy and other policies, 03.02.2006

Google's External and Internal Analysis

916 words - 4 pages Google’s internal structure stability can be influenced by external factors. To ensure the right decisions made, they must complete external and internal analysis. Google’s must contend with external environment influences, which are political, economical, and a technological. Day after day must be able to understand how the external environment influences can provide advantages to obtaining opportunities but on the downside expose the threats

Analysis of the external environment of "Ryanair –"Southwest" of European airlines" case

1722 words - 7 pages The objective of my report is to analyze the external environment in "Ryanair-'Southwest" of European airlines" case, which is very important factor for the firm's formulated effective strategy. The external environment consists of a wide array of economic and sociopolitical factors. It is the specific market arenas that the organization has chosen in its strategy; it provides the business opportunities to the firm and it's also a source of

Strategic Management. Internal and External Analysis of an airline organisation

2876 words - 12 pages aftersales service and support appear to create value and is vital in developing a competitive advantage. Support activities in the Value Chain also show potential to develop competitive advantage and are mainly linked with the Air NZ organisation infrastructure, resulting in efficiency gain and cost effectiveness. 2. External Analysis•Key industry dynamics/drivers/forces•Key trends from the macro-environment that are likely to

This essay including the external and internal SWOT analysis

3999 words - 16 pages safety. Develop some effective communication with the customers.Cleaning the bus on time, including the air in the bus.ConclusionIn this assignment, we have analyzed the company's statement, the market, and the environment. From the market and competitors analysis, it shows SBS Transit is the leader in the market of bus service; they have occupied 75% of the market share. But they still are trying to improve themselves, such as providing the special

The Relationship Between the Tourist Industry and the Environment

1201 words - 5 pages Adam 2005). A survey of water quality made by the Marine Conservation Society in mid season (from May to August) 2005 showed that ninety-four per cent of five hundred and fifty-five officially designated bathing beaches in UK got the grade of 'excellent' (http://www.goodbeachguide.co.uk). The information above shows that natural environment with its good quality is an important element of tourism promotion.Tourist industry makes contributions to

How Modern Technology Has Changed Medicine, Industry and the Environment

1619 words - 6 pages we lived. Modern Technology has had an impact the manufacturing industry, the finance industry, the medical field and our environment. Modern Technology has had an impact on the medical field. Steven Leckart claims 3D printers could make it possible to print out human tissue but the problem is it has to thrive, “an organ requires blood networks of blood vessels to distribute nutrients and oxygen”. If they cannot do that the cells will die. With

Analysis of the Business Environment of the Telecommunication Industry in India

1422 words - 6 pages India is the second largest telecommunications market in the world with around 900 Million subscribers at present. Since its liberalization in 1994, the industry has seen considerable growth with enactment of different regimes and entry of new players. However, in the last few years, the industry has been affected by the constant regulatory disputes and intense business environment leading to price war. The objective of this study is to analyse

Similar Essays

General And External Environment Essay

1011 words - 4 pages The general environment is composed of many conditions in the external environment that businesses encounter. The general environment is characterized by two main groups. The environmental uncertainty which is known to be lack of completes information about the environment and the specific environment which is all the elements the organization interacts with such as the population, stakeholders etc. This general environment is also made up of

Euro Disney Analysis Of The External And Internal Environment

1386 words - 6 pages their environment analysis. In this case there has been a recognition of a trend, which is the trend of people going to theme parks during the weekends for entertainment of them as well as their children. Also here is an existing need for entertainment of this kind. Therefore, an opportunity exists in the European market that Euro Disney could have taken advantage of. However, their failure to pick up signals from the macro environment and

Telecommunications Industry Environment Analysis

2477 words - 10 pages industry will continue, due to connected devices like gaming devices and e-readers, as well as ever evolving internet services like 4G networks and cheaper plan options. Trends, Patterns and Consistencies among key Environments For any business industry to prosper, it has to take into consideration the Business Environments in which it wants to operate. Business Environment is essentially a combination of external and internal factors that influence

Analysis Of The External Environment Of Business

1591 words - 6 pages Analysis of the External Environment of Business The Technological Environment The external business environment consists of four elements, they are as follows: Political, Economic, Social and technological. It would be impossible to analyse the whole environment in one essay, I have therefore decided to focus my essay on the technological environment. I have chosen this area to focus on because as Palmer and Hartley point out, it is one