BU481 Chapter 5: Chapter 5 Notes.docx
Document Summary
These boundaries represent what we call the relevant environment for the strategic proposal. Within this limited environment, you will need to establish a time horizon for analysis and to isolate the specific forces of demand, supply, competition, and government policy. Focus is critical to understanding the prospects of a strategy. Three tools will be useful in achieving a focused and properly timed environment analysis: a) your assessment of the performance of the business b) the strategic proposal itself c) the profit model underlying the business and the specific proposal. Refer to the text for a detailed description of the above tools. Minimizing the risks of focus: macroenvironment scanning. If your focus is too specific, you might miss the emergence of a new market opportunity. Also, if you concentrate overly on a particular time horizon, you may get blind sighted by events that lie just beyond the limit.
