Organization environment analysis

There Are two main types of analysis that you Can perform on the
environment that an Organization exists within
it is Important for the enterprise analyst to Understand the external as well
as the Internal factors within the environment An organization exists in
let’s firstly Consider the external environment Analysis
the techniques applied during External environment analysis are Focused
on assessing and analyzing the Key factors within the external
Environment of the organization
These can include factors such as the Competitors in the market and
economic Aspects outside of the organization

Then When you conduct the internal Environment analysis for an

organization You focus on analyzing the internal Considerations within the
organization
These types of factors will include Things such as the organization’s assets
,Knowledge , strategy and so forth
let’s Now look at some common analysis Techniques for the external as
well as The internal environment analysis
for The external environment analysis they Are the pestle and the Five
Forces Techniques which are applied
for the Internal environment analysis they are The most and the resource
ordered Techniques which are applied

Pestle Technic pestle analysis

aims to Gain an appreciation of the external Environment within which the
Organization operates

let’s now operates The elements of the pestle analysis that Leads to
consideration of the following Factors
political
this includes the Governmental influences on the business Environment
for example government Policy and regulations the stability of The
government or European directives.
Economic
these are the aspects within The economy that have an impact on the
Organization in the markets it targets
For example interest rates levels of Government spending and inflation

Socio-cultural
these include the Behavior, preferences and attitudes of The target
markets
for example consumer Expectations and beliefs levels of Education and
demographics
technological
Considering here the technological Advances that are occurring and
causing Changes within the industry
for example
Internet digital technology and Automation in manufacturing

Legal
These Refer to the regulatory and legal Changes likely to affect the
industry
For example employment law and health And safety legislation
and finally
Environmental
these are the green issues That may impact on the industry or Organization
for example packaging and Pollution

five forces technic

by Michael Porter a professor at Harvard Business School that Proposed
in his book competitive Strategy a means of analyzing the Competitive
forces within an industry

This approach examines five competitive Forces that determine the key
Competitive factors that apply to an Industry within which an organization
Operates

aspects to consider for each of The forces are suppliers and buyers what
Is their level of bargaining power are They in a strong position in relation to
The industry in general and this Organization in particular

new entrants
Is the industry open for other companies To move into this arena are their
entry Barriers such as startup costs or is it Relatively cheap to go into this
Business
Substitutes
are there products That can be used as alternatives
for Example in the transport industry a rail Company would consider cars
airplanes And buses as potential substitutes.

Industry competitors
How much rivalry is there between Existing firms in the industry
for
Example in the food retail industry Competition is very high and many
Smaller companies have been sold or Ceased trading.

Most analysis

the most analysis

The analyst to understand a company’s Current business strategy and the
Inherent strengths and weaknesses of the
Organization

the mnemonic represents the Following areas

m 4 mission
the defined Mission of the organization should state What business the
organization is in and What it is intending to achieve

o 4 Objectives
the goals against which the Organization’s achievements can be Measured

s for strategy
the approach That is going to be taken by the Organization in order to
achieve the Objectives and mission
t4 tactics
the Detailed means by which a strategy will Be implemented
 understanding what the Organization defines as its business Direction
helps the analysts gain a more Detailed appreciation of where the Business
system fits into the overall Organization and its contribution to the
Business strategy

a lack of clarity of The most definition for example an

Unclear mission statement or too few Specific objectives can also help to
Identify weaknesses in the organization

The resource audit

the resources of an Organization may help to develop a Competitive edge
particularly fair Deployed effectively

for example by Using staff with exceptional skills to Provide a better

service for customers
a Resource audit may be carried out in Order to identify and classify an
Organization’s resources

physical the
First type of resource relates to the Physical resources that the
organization Owns or has access to and includes Features such as
buildings plant and Equipment land and so on

financial these Are the financial resources that Determine the

organization’s financial Stability capacity to invest in new Resources and
ability to weather the Fluctuations in the market
human
 these Are the human resources and their Expertise adaptability and
commitment Etc
and finally know how
these are the Intangible resources such as the Know-how of the
organization which may Include actual patents or trademarks but This may
also be derived from the use Made of technology that is specific to The
business
for example manufacturing Technology
another intern Resource is the reputation of the Organization
for example the brand Recognition and the belief that is held About the
quality of the brand and the Goodwill that this produces

SWOT Analysis
SWOT analysis is a means of Pulling together the results of the
Examination of both the external Environment and the internal environment
Within which a company operates the Components of a SWOT analysis are
shown Below
this what provides a means of Summarizing the results of other Analysis
for example the pestle and Five Forces analysis provide information on The
external opportunities and threats
The resource audit and most analysis Provide information on the internal
Strengths and weaknesses
the SWOT Provides a summary of the current Situation of the organization
enabling The analyst to consider the following
The opportunities that are available to The organization the threats that
may Cause problems or affect the ability of The organization to grasp
opportunities
The strengths within the organization That may be harnessed in order to
grasp The opportunities and
 the weaknesses That need to be addressed in order to Prevent them
undermining the performance Of the organization
the SWOT can be Added to as the business analysis Project proceeds and
more information About the organization is uncovered.

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