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Chapter 2

Environmental influences

Outcome

By the end of this session you should be able to:

 discuss the need to consider the environment in which an organisation is
operating when assessing its performance using models such as PEST and
Porter’s 5 forces and evaluate how Porter’s 5 forces may assist in the
performance management process

 discuss the ways in which stakeholder groups operate and how they influence
an organisation and its strategy formulation and implementation (e.g. using
Mendelow’s matrix)

 discuss the social and ethical issues that may impact on strategy formulation,
and consequently, business performance

 evaluate how risk and uncertainty play an important role in long-term strategic
planning and decision-making that relies upon forecasts and exogenous
variables

 apply different risk analysis techniques in assessing business performance such
as maximax, maximin, minimax regret and expected values

 assess the impact of different risk appetites of stakeholders on performance
management

and answer questions relating to these areas.

The underpinning detail for this chapter in your Integrated Workbook can
be found in Chapter 2 of your Study Text

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