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Environmental scanning

For a company to gain or maintain a sustainable competitive advantage, it must be ever vigilant, watching for changes in the business environment. It must also be agile enough to alter its strategies and plans when the need arises.


There are three ways of scanning the business environment: Most commentators feel that in today's turbulent business environment the best scanning method is continuous scanning. This allows the firm to act quickly, take advantage of opportunities before competitors do, and respond to environmental threats before significant damage is done.

The Learning Organization

Once information is obtained, it must be disseminated throughout the company, to all departments, and at all levels. There is resistance to this outlook because many employees feel that knowledge is power and sharing knowledge will reduce ones worth to the company. Further, all people in the company should share in the task of scanning. When all employees scan some part of the environment, and all information, so obtained, gets disseminated through out the organization, the company is said to be a learning organization.

The Macroenvironment

Environmental scanning usually refers just to the macroenvironment, but it can also include industry and
competitor analysis, consumer analysis, product innovations, and the company's internal environment. Macroenvironmental scanning involves analysing: Scanning these macroenvironmental variables for threats and opportunities requires that each issue be rated on two dimensions. It must be rated on its potential impact on the company, and rated on it's likeliness of occurrence. Multiplying the potential impact parameter by the likeliness of occurrence parameter gives us a good indication of its importance to the firm.


When an issue is detected, there are generally six ways of responding to them:

See also:

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