1. Importance of Analyzing the Ex- ternal Environment -Managers can mitigate threats. -Managers can leverage opportunities. -Gain understanding of potential im- pacts. -Understand the source / proximity of factors. 2. The PESTEL Model -Groups environmental factors into six segments: --Politi...
1 importance of analyzing the ex ternal environment managers can mitigate threats managers can leverage opportunities gain understanding of potential im pacts understand the source proxi
MNG3701 - Strategic planning - LU3: Strategic Analysis: analyzing
the external environments. 2
Study online at https://quizlet.com/_52kag3
1. Importance of Analyzing the Ex- -Managers can mitigate threats.
ternal Environment -Managers can leverage
opportunities.
-Gain understanding of
potential im- pacts.
-Understand the source /
proximity of factors.
2. The PESTEL Model -Groups environmental factors
into six segments:
--Political
--Economic
--Sociocultural
--Technological
--Ecological
--Legal
These factors can create:
--Opportunities
--Threats
3. Political Factors -Processes & actions of
government bodies
-Firms can shape this factor through
--Lobbying
--Public Relations
--Contributions
--Litigation
Example: Tesla
-Has a build-to-order sales model
-Cuts out dealers
-Dealers are lobbying for new
legislation
1/
, MNG3701 - Strategic planning - LU3: Strategic Analysis: analyzing
the external environments. 2
Study online at https://quizlet.com/_52kag3
4. Economic Factors
2/
, MNG3701 - Strategic planning - LU3: Strategic Analysis: analyzing
the external environments. 2
Study online at https://quizlet.com/_52kag3
-Largely macro-
economic Examples
include:
--Growth rates
--Levels of employment
--Interest rates
--Price stability
--Currency exchange rates
5. Sociocultural Factors Society's cultures, norms, and value
-Are constantly in flux
-Differ across groups
Demographic trends
-Present opportunities and threats
-Population characteristics
related to age, gender, family
size, ethnicity, sex- ual
orientation, religion, and
socioeco- nomic class
6. Technological Factors Application of knowledge
-To create new processes
-To create new products
Innovations in process technology:
-Lean manufacturing, Six Sigma
quality, and biotechnology
Innovations in product technology:
-Smartphones, computer
tablets, and high-performing
electric cars such as the Tesla
Model S
7. Legal Factors Official outcomes of political
processes:
-Laws
-Mandates
3/
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