internationalization with environmental scanning
This essay will provide a critical analysis of a business looking at internationalization. It will examine the benefits of environmental scanning on aspects such as organization performance, as well as the importance of creating an internationalisation strategy. It will also use past studies to demonstrate the opportunities environmental scanning can bring, in comparison to those business who merely use it.
“With fading barriers to trade, investment opportunities and technological innovation, more companies are advertising their products and services online as they see new openings for increased profit and growth” (Clipici, & Hagiu, 2009, p. 375). However, before a business begins to advertise their products or services over the web, it is curial that they undertake environmental scanning and create an internationalisation strategy. Environmental scanning is the process of collecting information about events, trends, and relationships extracted from an organization’s external environment to support top strategic planning and decision-making (Lau, Liao, Wong, & Chiu, 2012).
The purpose of environmental scanning is to help identify strategic factors, that will help determine the future of the organization. Many businesses can conduct such a procedure through a PEST Analysis or a SWOT Analysis. A PEST analysis is a useful business measurement tool for understanding market growth or decline and a direction for a business. PEST is an acronym for political, economic, social and technological analysis. Political factors include government policies relating to the industry, tax policies, laws and regulations, trade restrictions and tariffs. The economic factors relate to changes in the wider economy such as economic growth, interest rates, exchange rates and inflation rate. Social factors often look at the cultural aspects and include health consciousness, population growth rate, age distribution, changes in tastes and buying patterns (Research and markets,
“With fading barriers to trade, investment opportunities and technological innovation, more companies are advertising their products and services online as they see new openings for increased profit and growth” (Clipici, & Hagiu, 2009, p. 375). However, before a business begins to advertise their products or services over the web, it is curial that they undertake environmental scanning and create an internationalisation strategy. Environmental scanning is the process of collecting information about events, trends, and relationships extracted from an organization’s external environment to support top strategic planning and decision-making (Lau, Liao, Wong, & Chiu, 2012).
The purpose of environmental scanning is to help identify strategic factors, that will help determine the future of the organization. Many businesses can conduct such a procedure through a PEST Analysis or a SWOT Analysis. A PEST analysis is a useful business measurement tool for understanding market growth or decline and a direction for a business. PEST is an acronym for political, economic, social and technological analysis. Political factors include government policies relating to the industry, tax policies, laws and regulations, trade restrictions and tariffs. The economic factors relate to changes in the wider economy such as economic growth, interest rates, exchange rates and inflation rate. Social factors often look at the cultural aspects and include health consciousness, population growth rate, age distribution, changes in tastes and buying patterns (Research and markets,
References: Adriana, G., & Monica, D. (2008). Romanian capital market: PEST and SWOT analyses Babatunde, B. O., & Adebisi, A. O. (2012). Strategic environmental scanning and organization performance in a competitive business environment. Economic Insights - Trends & Challenges, 64(1), 24-34. Choo, C. W. (2001). Environmental scanning as information seeking and organizational learning Cho, T. S. (2011). Environmental scanning behaviour of the top managers: A regulatory focus model. Seoul Journal Of Business, 17(2), 151-166. Clipici, E., & Hagiu, A. (2009). The international conference on economics and administration: The internaisational strategy in a global age Lau, R. K., Liao, S. Y., Wong, K. F., & Chiu, D. W. (2012). Web 2.0 environmental scanning and adaptive decision support for business mergers and acquisitions Rahim, M., & Marvel, M. R. (2011). The role of emotional intelligence in environmental scanning behaviour: A cross-cultural study Research and markets. (2012) PEST Analysis: Infrastructure and developments in Taiwan