Swot & Pest Analysis_Sovan Mangaraj

8/12/2019 Swot & Pest Analysis_Sovan Mangaraj

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Environmental Scanning

&

Monitoring Techniques

Asst.Prof.Sovan Mangaraj

Innovation The B-School

[email protected]


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ENVIRONMENTAL SCANNING & MONITORING

Environmental scanning is a concept from businessmanagement by which businesses gather information from

the environment, to better achieve a sustainable competitive

advantage.

For sustained competitive advantage the company must

also respond to the information gathered from environmentalscanning by altering its strategieswhen the need arises.
http://en.wikipedia.org/wiki/Sustainable_competitive_advantagehttp://en.wikipedia.org/wiki/Sustainable_competitive_advantagehttp://en.wikipedia.org/wiki/Strategyhttp://en.wikipedia.org/wiki/Strategyhttp://en.wikipedia.org/wiki/Sustainable_competitive_advantagehttp://en.wikipedia.org/wiki/Sustainable_competitive_advantagehttp://en.wikipedia.org/wiki/Sustainable_competitive_advantagehttp://en.wikipedia.org/wiki/Sustainable_competitive_advantagehttp://en.wikipedia.org/wiki/Sustainable_competitive_advantage


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SWOT(Strength-Weakness-Opportunity-Threat)

Identification of threats and Opportunitiesin theenvironment (External) and strengthsand

Weaknessesof the firm (Internal) is thecornerstone of business policy formulation; it is

these factors which determine the course of actionto ensure the survival and growthof the firm.


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SWOT Analysis


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The SWOT analysis is an extremely useful tool forunderstanding and decision-making for all sorts of situations

in business and organizations. SWOT is an acronym forStrengths, Weaknesses, Opportunities, Threats.

SWOT analysis came from the research conducted at Stanford

Research Institute from 1960-1970. The background to SWOToriginated from the need to find out why corporate planningfailed. The research was funded by the fortune 500

companies to find out what could be done about this failure.

SWOT ANALYSIS


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SWOT: Studying Internal & External

Environment

The aim of any SWOT analysis is to identify the

key internal and external factors that are

important to achieving the objective. SWOT

analysis groups key pieces of information into

two main categories:

Internal factorsThe strengths and weaknesses

internal to the organization.

External factors The opportunities and threats

presented by the external environment.


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Examples of SWOTs

StrengthsandWeaknesses Efficient & Skillful Human Resource

Sound Financial Capability

Creativity / ability to develop new products

Possession of Modern Technology

Strong Distribution Network

Unskilled Human Resource

Inadequate Financial Health

Less Focus on R & D

Obsolete Technology

Poor Distribution Network


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Opportunities Takeovers

Market Trends

Economic condition

Mergers

Joint ventures

Strategic alliances

Threats Expectations of

stakeholders

Technology

Public expectations

Competitors andcompetitive actions

Poor Public Relations

Development

Criticism (Editorial)

Global Markets

Environmental conditions


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Uses of SWOT Analysis

Corporate planning Deciding which business to ventureinto.

Set objectivesDefining what the organisation is intendingto do.

Environmental scanning

Internal appraisals of the organization's SWOT, thisneeds to include an assessment of the present situationas well as a portfolio of products/services and an analysisof the product/service life cycle.


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Analysis of existing strategies, this should determine

relevance from the results of an internal/external appraisal.This may include gap analysis(compare its actualperformance with its potential performance which will look atenvironmental factors)

Strategic Issuesdefined key factors in the developmentof a corporate plan which needs to be addressed by theorganisation

Develop new/revised strategiesrevised analysis ofstrategic issues may mean the objectives need to change
http://en.wikipedia.org/wiki/Gap_analysishttp://en.wikipedia.org/wiki/Gap_analysis


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Remember

Use SWOT analysis for business

planning, strategic planning,

competitor evaluation, marketing,business and product development

and research reports.


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PEST Analysis

A scan of the external macro-environmentin which the firm

operates can be expressed in terms of the following factors:

PoliticalEconomic

Social

Technological


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The acronym PEST(or sometimes rearranged as "STEP") is

used to describe a framework for the analysis of these macro

environmental factors. A PEST analysis fits into an overallenvironmental scan as shown in the following diagram:

Environmental Scan

/ \

External Analysis Internal Analysis

/ \

MacroEnvironment

MicroEnvironment

|

P.E.S.T.


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POLITICAL FACTORS

Political factors include government regulations and legalissues and define both formal and informal rules under which

the firm must operate. Some examples include:

Political stability

Tax policy

Employment laws

Environmental regulationsTrade restrictions and tariffs


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ECONOMIC FACTORS

Economic factors affect the purchasing powerof potential

customers and the firm's cost of capital. The following are

examples of factors in the macro economy:

Economic growth

Interest rates

Exchange rates

Inflation rate


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SOCIAL FACTORS

Social factors include the demographic and cultural

aspects of the external macro environment. These factors

affect customer needs and the size of potential markets.

Some social factors include:

Health consciousness

Population growth rate

Age distributionCultures and Values


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TECHNOLOGICAL FACTORS

Technological factors can lower barriers to entry, affect

efficient production levels, and influence outsourcing

decisions. Some technological factors include:

R&D activity

Automation

Rate of technological change


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Thank You

Documents

Swot & Pest Analysis_Sovan Mangaraj