BUS 331 Chapter Notes - Chapter 3: Pest Analysis, Switching Barriers, Vertical Integration
18 Feb 2016
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Evaluating the strategically relevant components of a company"s macro-environment. Macro-environment broad environmental context in which a company is situated pestel analysis. Pestel analysis evaluate relevance of political, economic, social, technological, environmental, and legal forces. The biggest factors that influence strategy are the inner ring. Assessing the company"s industry and competitive environment 7 questions. Market size and growth rate, scope of competitive rivalry (geographic area), demand-supply conditions, market segmentation, pace of technological change. Five-forces model of competition buyer bargaining power, substitute products, supplier bargaining power, new entrants, rivalry among competing sellers. If the five competitive forces are very strong, it becomes harder for industry members have a good profit margin. Driving forces major underlying causes of change in industry and competitive conditions. Strategic group industry members with similar competitive approaches and positions in the market. The closer strategic groups are on the map, the stronger the inter-strategic group rivalry is.
