Environmental analysis & forecasting
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The document outlines the stages of environmental analysis and forecasting for organizations: 1) Scanning detects early warning signals and identifies emerging trends in the external environment. 2) Monitoring analyzes trends over time to determine patterns and issues requiring further analysis. 3) Forecasting anticipates future changes to key variables to identify threats and opportunities and help with strategic planning. 4) Assessment evaluates the potential impacts of forecasts on the organization to determine implications.
Environmental analysis & forecasting
- 1. ENVIRONMENTAL ANALYSIS AND FORECASTING
- 2. STAGES OF ENVIRONMENTAL ANALYSIS Scanning to detect warning signals. Monitoring trends. Forecasting future changes. Assessing the changes for organizational implications.
- 3. Scanning Analyzes environment for identifying factors with impact / implications for business. Exploratory in nature Identifies emerging / ensuing trends . Alerts organization on potentially significant external factors before crystallization.
- 4. Monitoring Focused & systematic in-depth analysis of relevant environmental trends. Gather data to determine emerging patterns Outputs of monitoring : 1. Environmental patterns to be forecast 2. Trends for further monitoring 3. Patterns requiring further scanning.
- 5. Forecasting… Anticipating trends in future changes Pinpoint critical variables emerging / declining Give more concrete views on threats and opportunities Help formulate strategic plans .
- 6. Assessment Assess/Evaluate the impact on organization's business. Draws up implications / possible impacts. What foreshadow environment holds for the organization
- 7. Environmental Analysis: APPROACHES Inside-out (micro) – narrow view of environment, forecast the immediate future environment Outside-in (macro) scenario analysis – broad view of BE, long term perspective, develop alternative scenarios
- 8. Scenario Analysis Technique Forecast, occurrence of complex environmental events. Detailed description, possibility of occurrence of events with consequences for organization.
- 9. 7 steps to develop scenarios Identify strategic environmental issues Select important issues Prepare preliminary description of issues Draw out the implications of issues ( variables that can be controlled and cannot Develop detailed descriptions – scenarios (best case, worst, most likely one) Discuss scenarios with top management Develop contingency action plans
- 10. FOUR TECHNIQUES Verbal and Written Information Search and Scanning Spying Forecasting and formal studies
- 11. FORECASTING : STEPS Identification of Relevant Environmental Variables Collection of Information Selection of forecasting Technique Monitoring ( pg: 68 - 73 )