Characteristics of an Organization’s Environment

Two organizations face

exactly the same
external environment.
The relationships,
events & conditions
that make up the
unique environment
of any organization
are static.

Characteristics
Characteristics
Organization are not
helpless in the face of
environmental forces,
but certainly some
aspects of environmental
change are more
amenable than others to
control or influence.
Requirement of environmental analysis

Defining Determining the relevant

environmental forces and the
geographical scope of operation.

Ensuring that information is available

Environmental
concerning the defined environment.
Analysis

Scanning &
Interpreting
forecasting

Packaging the information into forms

that are useful for strategic planning.
Forces
Forces
Economic Forces: the Fluctuations of local, national & world economies are related in many
ways ,
1. In local situation : an organization might seek information concerning the economic base and
future of the region and the effects of this outlook on wage rates, disposable income,
unemployment , and the transportation and commercial base.
2. National level: trends in growth , income levels, inflation , balance of payments and taxation are
only a few of the indicators of the ability of the economy to produce and consume goods and
services.
3. The international level: this economy can be divided into four economic categories:
1. The western democracies.
2. The eastern bloc.
3. The underdeveloped nations .
4. The developing nations.

Technological Forces: Technological refers to the means chosen to do useful work . Technological
forces include not only the glamorous invention that revolutionizes our lives but also the gradual
improvements in methods, in materials, in design, In application into new industries & in efficiency.
Social Forces: Include factors that relate to the values , attitudes, &
demographic characteristics of an organizations customers. Dynamic
social forces can significantly influence the demand for an
organization’s products or services and can alter its strategic decisions.

Political Forces: The political orientation of the U.S House of

Representatives, the senate, & the presidency have an important
influence on strategic planning decision. In the regulatory environment
federal , state , and local governments have increasingly passed laws
that affect the operation of businesses. Not all government actions are
restrictive in nature, some affect organization positively. For example;
government purchase have a major influence in the aero-space ,
defense & ecteronic industries.
 Forecasting
ForecastingTechniques
Techniques

Survey
Time-series
Time-series
& Analysis
Analysis
Opinion
polling

Jury of
Delphi
Executive
opinion
Technique Special
Special
Special
Precautions Regression

Qualitative with
Precautions
Precautions
with
with for
for
Qualitative Regression
Modeling
Modeling

Forecasting
Techniques

Sales Force Customer

Evaluation Econometric
Econometric
composite Modeling
Modeling
Ranking

This ranking rests on the premise

that projections have either
Threats and negative or positive consequences
opportunitie for the organization .projection
that carry potentially positive
s ranking consequences are called
opportunities and which carry
Rankin negative that are called threat
g
This systems requires consideration
of each projection along two
Dual dimension: the potential impact on
Ranking the organization and the likelihood
of actual occurrence.