Analysing the External Environment A. INTRODUCTION TO SESSIONtc A. INTRODUCTION TO UNIT For many companies in the UK and the United States the period 1950 to 1970 seems in retrospect to have been one of almost uninterrupted straight-line growth in a relatively stable environment. In such a situation managers look effective and perhaps they are effective if they do the same thing over and over again and appoint successors in their own image. Then in the 1970s a big change took place. Doing the same thing became almost a recipe for corporate disaster. The reason for this was simple. Instead of being routine and fairly predictable, the business environment had become increasingly volatile according to many managers the pace of change had accelerated (or so they thought). This process has continued into the 1990s, and at the same time many managers would claim that the complexity of the environment they face has also increased. This Session discusses the nature of the external environment and examines some of tools and frameworks used to assess the impact of external conditions upon the strategies of organisations. Your Objectives By the end of this session you should be able to Appreciate the nature of the external environment and its implications. Understand the process of environmental analysis as a critical element of strategic management. Apply some of the key tools and frameworks available to help evaluate the strategic implications of conditions and changes in the external environment. B. THE NATURE AND IMPLICATIONS OF THE EXTERNAL ENVIRONMENTtc B. THE NATURE OF THE EXTERNAL ENVIRONMENT What do we mean by the external environment Broadly, the external environment comprises those factors and trends outside the organisation that might have an influence upon an organisation and its future. Many external factors can have an effect upon an organisation - from changes in government legislation (e.g. the ending of Duty Free sales to travellers within Europe), to the entry of new competition into a market (e.g. the opening of a new supermarket near to an existing shopping centre). Some environmental changes might affect all or many organisations, whilst others may be limited to only one or two. The complexity of the external environment faced by different organisations is likely to vary greatly. A global corporation will face many influences, some changing from country to country, such as consumer legislation, whilst others like technological changes are intrinsically more international. In contrast, the influences faced by a village shop are likely to more limited in range and variety, such as the number of local customers and their buying habits, though perhaps no less critical to the future of the business. Arguably, it is a clich to say that in todays world even the pace of change is changing, but for most organisations the dynamic nature of their external environment is not invalidated by this statement, however hackneyed. For example, the emergence of the Internet is affecting organisations from large to small, and in the public sector as well as those in industry and commerce, with new developments quickly diffusing across the globe leading to changes in market structures and business practices. The Need to Monitor the External Environment Otherwise ably managed organisations are frequently taken by surprise by events what may seem to the observer to have been quite predictable. Managers are prone to describe their failures as due to bad luck and their successes as due to good management. These points illustrate both the importance of trying to undertake environmental analysis, but also suggest that such analysis is not entirely objective. If the process is viewed as a scientific experiment, then the analyst is also part of the experiment. Consequently, the results of the analysis are as much the product of expectations, prejudices, assumptions and typology as they are of objective circumstances. Despite…
In our interview with Chris Spinelli the co-owner of Roc Brewing; we sat down and discussed how exactly this business idea came about as well as what it takes to be a successful entrepreneur. Chris started his career by choosing to go to college at RIT to pursue his degree. He was able to take advantage of getting his degree at RIT because his mother had worked there allowing him some special benefits to practically go there for nothing. One day Chris and his friend John were just sitting around…
liberalisation as expressed in the EU competition commissions policy by analysis of:
Benefits to customers
Potential economic development and gdp growth (40%)
Discuss advantages of liberisation etc(20)
Compare experiences of liberisation within the EU member states to other world wide experiences. (10%)
Grammar research (30%)
To understand the EU competition policy, you have to understand in economic terms what competition is. Competition is described in economic…
The air, the water, the atmosphere, the rocks, the vegetables, the animals, etc; environment is the support of the life. That’s why the man owes to respect it because the life of the man depends on it. However, this one, key element of our survival, is dangerously affected by our activities. The pacifist and ecologist actions, at the end of the 60s, allowed making take into account to numerous persons that the excessive exploitation of natural resources caused a…
Paddock Wood Brewing Co: A Strategic Analysis Report
This analysis showcases what Paddock Wood currently does well and what it can do better in
the future to expand its market. Paddock Wood does not have an updated marketing plan and
there is no promotional budget. While it is enjoying catering to a niche market, the influx of
population demographics continues to change and there is no guarantee of loyalty from their
customers. Beer industry continues to be strong and…
BEER INDUSTRY CASE STUDY
Beer industry is one of the oldest industries particular in EU as it is one of the biggest beer consumption markets. This industry has seen fluctuation of the demand and consumption of the beer over the last quarter of 20th century due to many factors. This analysis will look in to those factors by taking into account the case given and will analyze the general reasons, growth and effects of the industry keeping in mind the macro-environment and its main component…
rivals and scope of competitive rivalry
Dominated by Nestle, Danone, PepsiCo, Coca-Cola and many small regional sellers.
The four largest producers have accounted for 34% of worldwide bottle sales in volume.
Nestle became the global leader in this industry.
Introduction of enhanced water or functional waters.
Market for enhanced waters is expanded.
Enhance waters offered higher margins.
Competitive Forces Analysis
Rivarly among Competing Sellers
Oligopoly market and characterized…
was Khemka family involve during the case?
SUN Brewing was founded in 1992 by Shiv Khemka with Nand, his father, and his brother, Uday.
The situation is set in March 1999, when the company was facing a major crisis.
In 1998, the family had been planning to raise a $200-$400 million through equity and debt offering for the company on the NYSE (New York Stock Exchange), in aim to finance major investments because of the increasing competition from international beer companies in the Russian market…
Élan and the Competition Ski Boat Industry
Robert Visser, 5002930146
Punnapa K. Pusayanonda, 4702641038
Patumporn Srikrisanapol, 4702640642
Case Study, Strategic Management
Prof. James P. Fitzpatrick
Deadline: 19. September 2007
1. Company Overview 3
2. SWOT Analysis 4
2.1 Strength 4
2.2 Weakness 4
2.3 Threat 5
2.4 Opportunity 6
3. Situation Analysis 8
3.1 Financial Analysis 8
3.2 Marketing Analysis 9
non-labour costs), raw material such as barley, and energy. The European packaging industry is highly concentrated, dominated by international companies such as Crown in cans and Owens-Illinois in glass bottles. During 2006, Dutch brewer Heineken complained of an 11 per cent rise in packaging costs.
Global forces and the European brewing industry
Mike Blee and Richard Whittington
This case is centered on the European brewing industry and examines how the increasingly competitive pressure of operating…