Macroenvironment: Strategic Management and Competitive Advantage

Second edition Global and Transnational Business Strategy and Management George Stonehouse, Jim Hamill, David Campbell, Tony Purdie ANALYSIS OF THE GLOBAL MACROENVIRONMENT 5 Learning objectives After studying this chapter students should be able to: * describe the nature of the macroenvironment; * define and distinguish between continuities and discontinuities in the business environment; * explain each of the factors to be analysed in a STEP analysis; * describe why macroenvironmental analysis is more complex for international businesses; . explain how national circumstances can affect global strategy; * describe the stages in carrying out a STEP analysis. |

Introduction Strategic planning is made more difficult by the rate of change, complexity and associated uncertainty in the environment. Sanchez and Heene (1997) stated that ‘In dynamic environments, building and leveraging competences requires flexibility in acquiring and deploying new resources effectively in changing circumstances.’ It is evident therefore that successful strategy and associated competence development must be informed by a detailed understanding of the business environment. In Chapter 4 we examined the importance of industry analysis. In this chapter we look outside of the industry to learn about those forces at work that are outside an organization’s control and with which the business must usually learn to ‘cope’. A thorough macroenvironmental analysis is an ambitious task for a non-internationalized business, but for a global company the task is made all the more complex because of the number of industries, markets and countries in which it may operate. Change in the business

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