STRATEGIC MANAGEMENT

Course Leader: Berihun Muchie (PhD)

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Copyright © 2021
Yardstick International College

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CHAPTER THREE
PART I

Strategy Formulation And Strategic Environment

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The External Environment: Opportunities,
Threats, Industry Competition, and
Competitor Analysis

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 QUESTION TIME
1. Strategic Leader supposed to make the following
strategic environment analysis before strategy
formulation except…

A. Competitor environment
B. Industry environment
General
C. CREDITS: Environment
This presentation template was created by
All
D. Slidesgo, including icons by Flaticon, infographics &
E. None images by Freepik

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Cont….
● Strategic Leader supposed to make the following strategic environment
analysis before strategy formulation except…
A. Competitor environment
B. Industry environment
C. General Environment
D. All
E. None

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The External Environment
Environment

Economic

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Ge
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Industry

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Environment

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Threat of new entrants

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Power of suppliers

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De

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Power of buyers

ral
Product substitutes
Intensity of rivalry
Po
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Competitor

nt
En

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me
Environment
vir

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Le
o

on
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vir
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Technological
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General 7
External Environmental Analysis
● A continuous process which includes
o Scanning: Identifying early signals of environmental changes and
trends
o Monitoring: Detecting meaning through ongoing observations of
environmental changes and trends
o Forecasting: Developing projections of anticipated outcomes based
on monitored changes and trends
o Assessing: Determining the timing and importance of
environmental changes and trends for firms’ strategies
and their management

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QUESTION TIME
2. Which one of the following involves
developing projections of anticipated outcomes
based on monitored changes and trends

A. Monitoring
B. Forecasting
Scanning
C. CREDITS: This presentation template was created by
Assessing
D. Slidesgo, including icons by Flaticon, infographics &
images by Freepik

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External Environmental Analysis
Analysis of general environment

Analysis of competitor environment

Analysis of industry environment

The External
Environment

Strategic Intent
Strategic Mission

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General Environment
● Socio-cultural segment
● Women in the workplace
● Workforce diversity
● Attitudes about quality of work life
● Concerns about environment
● Shifts in work and career preferences
● Shifts in product and service preferences

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General Environment
Economic segment
● Inflation rates
● Interest rates
● Trade deficits or surpluses
● Budget deficits or surpluses
● Personal savings rate
● Business savings rates
● Gross domestic product

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General Environment
Political/Legal Segment
● Antitrust laws – designed to prevent monopolies and encourage market
competition
● Taxation laws
● Deregulation philosophies
● Labor training laws
● Educational philosophies and policies

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General Environment
Technological Segment
● Product innovations
● Applications of knowledge
● Focus of private and government-supported R&D expenditures
● New communication technologies

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General Environment
Global Segment
● Important political events
● Critical global markets
● Newly industrialized countries
● Different cultural and institutional attributes

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General Environment
Demographic Segment
● Population size
● Age structure
● Geographic distribution
● Ethnic mix
● Income distribution

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 DISCUSSION POINT
- Discuss and elaborate the different general
environments.

(Please discuss your thoughts on the LMS discussion board)

CREDITS: This presentation template was created by

Slidesgo, including icons by Flaticon, infographics &
images by Freepik

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 ANY QUESTIONS
Please use the LMS forums and messaging functions to ask

?
any questions you may have

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End of Chapter-3 Part-1

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THANK YOU!

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