ENVIRONMENTAL SCANNING:
SWOT &
PEST
ANALYSES
MAJOR PROBLEMS FACED BY
BUSINESSES:
1. Uncertainty
2. Globalization
3. Innovation
4. Government Policies
5. Technology
6. Diversity
7. Complexity
8. Information Overload
The
Environment
of the Firm
Firm’s Environment
It refers to the
conditions and
elements that define its
operations and
determine its success.
INTERNAL
ENVIRONMENT
Consists of elements that have a
direct impact on business
operations. These include
employees, the board of directors,
and the managers.
EXTERNAL
ENVIRONMENT
Consists of factors that have
indirect but significant
influence on the operations
of the business.
EXTERNAL ENVIRONMENT
MICROENVIRONMENT
is also known as the “operating
environment”. It consists of the
customers, suppliers, regulatory
agencies, and competitors.
EXTERNAL ENVIRONMENT
MACROENVIRONMENT
is also known as the “general
environment”. It consists of the
economic, political, social, legal, &
technical environment of the business.
ENVIRONMENTAL SCANNING
It is the actual monitoring
& evaluation of information
from the external and
internal environment of a
business organization.
ENVIRONMENTAL SCANNING
1.AD HOC ENVIRONMENTAL SCANNING
is not often done and is usually applicable only
during a crisis situation. The firm does this to
determine whether a problem is either external
or internal.
ENVIRONMENTAL SCANNING
2. REGULAR SCANNING
is usually done at least once a
year or at regular intervals
ENVIRONMENTAL SCANNING
3. CONTINUOUS SCANNING
refers to continuous collection of data on a broad
range of environmental factors. It is also referred to
as continuous learning done to monitor the
components of an organization.
Strategic
Planning:
SWOT & PEST
Analyses
SWOT Analysis
Strengths, Weaknesses, Opportunities, & Threats
This is primarily used to
analyze the microenvironment.
STRENGTHS
What does your company do better than the others?
include the company’s
attribute that give a
competitive edge over others
WEAKNESSES
What aspects of your company need to be improved?
These attributes may hinder
the company’s growth &
performance.
OPPORTUNITIES
What trends/conditions can positively impact your company?
It can give a positive impact to
the company if properly
addressed.
THREATS
What trends/conditions can negatively impact your company?
These are trends or changes, or
movements over which the company has
no control but should be addressed to
maintain its status in business.
PEST Analysis
Political, Economic, Social, and Technological
This analysis is conducted to
address the firm’s
macroenvironment.
POLITICAL factors
include laws, regulations, and
restrictions that may intervene
or affect the company’s
business course.
ECONOMIC factors
directly affect the capability of
business to generate profits. These
include economic growth, interest
rates, exchange rates, & inflation rates.
SOCIAL factors
include demographic aspects such as
age, group affiliation, religion, civil
status, and the economic status of
consumers
TECHNOLOGICAL factors
include research and development
activities, automation, licensing,
patenting, technological shifts, and
outsourcing decisions.
BENEFITS OF
STRATEGIC
PLANNING
KNOW
YOUR
JARGON
ECONOMIC GROWTH
An increase in the amount and
value of goods and services
produced by an economy for a
certain period of time.
EXCHANGE RATE
The price of a nation’s currency in
comparison to foreign currency.
This is used as basis for changing
one currency into another.
INFLATION RATE
how fast the general level of
the prices of goods &
services increases.
ACTIVITY
NO. 4
In a 1/2 yellow pad paper, match the
conditions with the kind of environment
it is associated with and the type of
factor it is classified based on SWOT
Analysis.
EXAMPLE:
High Inflation Rate -- External -- Threat
SWOT
ENVIRONMENT
CONDITIONS (external or internal)
(Strengths, Weaknesses,
Opportunities, and Threats)
Lack
1 of management skills of middle
managers
Good corporate
2
integrity
3 Eco-friendly products
Lack of advertisement & other
4
forms of promotion
5 New competitors
Thank you
for
listening!
