• Underlying philosophy of the company culture and give direction to its employees.
STEP 2: ENVIRONMENTAL ANALYSIS
The mission, vision and values drive the second component of the strategic management
process: analysis of external opportunities and threats.
Environmental Scanning – Systematic monitoring of the major external forces influencing
The six most highly monitoring external issues are:
1. Economic factors and envelopment information, including general, regional and
2. Industry and competitive trends, including new processes, services and innovations.
3. Technological changes, including information technology, innovations and
4. Government and legislative issues, including laws and administrative rulings,
5. Social concerns, including childcare, elder care, the environment and educational
6. Demographic and labour market trends, including the age, composition and literacy
of the labour market and immigration.
Five forces in the competitive environment:
• New entrants
o To protect a company’s position in an industry, companies often try to
establish entry barriers to keep new firms out.
o When new firms do enter an industry it is often because they have a different
and perhaps better way to provide customer value.
o Identifying the needs of customers.
o Creating customer value and different customers often want different things.
o Actions and attitudes that lead to excellent customer service can include:
▪ Speed of delivering normal orders.
▪ Willingness to meet extraordinary needs.
▪ Merchandise delivered in good condition.
▪ Readiness to take back defective goods and resupply new goods
▪ Availability of installation and repair services and parts.
o Ex. Telephone industry, landline versus mobile.