Evaluate the View That an Uncertain and Dynamic External Environment Requires More Effective Application of Analytical Tools and Frameworks for Environmental Analysis!
MODULE Strategic Management in a Global Context
MODULE LEADER
ASSESSMENT A
Evaluate the view that an uncertain and dynamic external environment requires more effective application of analytical tools and frameworks for environmental analysis!
Submitted by
19th October 2011
1896 words
-0-
INTRODUCTION This essay is to assess the view, that an uncertain and dynamic external environment requires more effective application of analytical tools and frameworks for environmental analysis. To evaluate this statement this essay will go into details concerning the topics of present and future external environment, review of analytical tools, role of analytical toolkit in a dynamic environment and also the benefits and problems arising from dynamic change, showing that coping with the dynamic of the business environment is a challenge but also a chance for business success in the present and the future.
MAIN BODY First of all it is essential to analyse the meaning behind the term “external environment”. “Environments are conceptualized as extended social field(s)…with a causal texture” (Selsky, Goes and Babüroglu, 2007). The external environment of a company consists of market and competitors as well as industry and finally the macro-environment. These factors are considered to be the main drivers for a company’s business. Furthermore, in order to achieve sustainable success by understanding and eventually influencing the environment of their company, managers have to analyse and evaluate the external factors very accurately. Therefore it can be truly followed, that according to Johnson, Scholes and Whittington (2008, p. 54), “environment is what gives organisations their means of survival”.
Now, as it is clear what the definition of external environment implicates, it has to be asked why it is essential to understand the future environment. To answer this question, one has to look at the definition of strategy after Glueck. According to this, “a
MODULE LEADER
ASSESSMENT A
Evaluate the view that an uncertain and dynamic external environment requires more effective application of analytical tools and frameworks for environmental analysis!
Submitted by
19th October 2011
1896 words
-0-
INTRODUCTION This essay is to assess the view, that an uncertain and dynamic external environment requires more effective application of analytical tools and frameworks for environmental analysis. To evaluate this statement this essay will go into details concerning the topics of present and future external environment, review of analytical tools, role of analytical toolkit in a dynamic environment and also the benefits and problems arising from dynamic change, showing that coping with the dynamic of the business environment is a challenge but also a chance for business success in the present and the future.
MAIN BODY First of all it is essential to analyse the meaning behind the term “external environment”. “Environments are conceptualized as extended social field(s)…with a causal texture” (Selsky, Goes and Babüroglu, 2007). The external environment of a company consists of market and competitors as well as industry and finally the macro-environment. These factors are considered to be the main drivers for a company’s business. Furthermore, in order to achieve sustainable success by understanding and eventually influencing the environment of their company, managers have to analyse and evaluate the external factors very accurately. Therefore it can be truly followed, that according to Johnson, Scholes and Whittington (2008, p. 54), “environment is what gives organisations their means of survival”.
Now, as it is clear what the definition of external environment implicates, it has to be asked why it is essential to understand the future environment. To answer this question, one has to look at the definition of strategy after Glueck. According to this, “a
References: 1. John W. Selsky, Jim Goes and Oguz N. Babüroglu, Contrasting Perspectives on Strategy Making: Applications in Hyper Environments, 2007, pages 71-94. 6. N. Gregory Mankiw, Principles of Economics, 6th Edition, 2008, page 54 http://books.google.com/books?id=nZE_wPg4Wi0C&Ipg=PA55&dq=opportunity%20 costs&pg=PA54#v=onepage&q=opportunity%20costs&f=false 7 8. Courtney, Kirkland, Viguerie, Strategy under uncertainty, Harvard Business Review, 1997 http://www.civ.utoronto.ca/sect/coneng/tamer/Courses/1299/Ref/strategy%20unde r%20uncertainty.pdf 9 10. Regine Barth, Franziska Wolff, Corporate Social Responsibility in Europe – rhetoric and realities, 2009, pages 270-272 http://books.google.com/books?id=zgL3p855qu4C&Ipg=PA270&dq=PESTEL%20Fram ework&pg=PA270#v=onepage&q=PESTEL%20Famework&f=false 11 18. H. Mintzberg (1994) The Fall and Rise of Strategic Planning Harvard Business Review January/February p107-114; -8- 20. H. Mintzberg (1994) Rethinking Strategic Planning Part II: New Roles for Planners, pages 22-30; http://www.mintzberg.org/sites/default/files/rethinking_strategic_planning_2.pdf 21 26. F.X. Bea, J.Haas, Strategisches Management, 4. Edition, 2005, p.86-111 (Umweltanalyse) http://books.google.com/books?id=_b_a9crUKXUC&lpg=PA43&dq=Strategisches%20Manag ement&pg=PA59#v=onepage&q&f=false