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Strategic Management 6 External Analysis
Technological factors
These can be internal and external. Organizations use technology – not hardware but software too such as Quality Control
– and produce products and services of varying complexity.
They include
• Goods and services.
• Production processes.
• Information and communications.
• Transport and distribution.
• information technology, computing and associated implications for production
• biotechnology and new industries..
How to use the analysis tools:
• Scan the macro-environment for actual or potential changes in the PEST factors.
• Assess the importance of the changes for the market, industry and business.
• Analyse each of the relevant changes in detail and the relationships between them.
• Assess the potential impact of the changes on the market, industry and business.
6.2.2 The ‘near’ environment
This is the ‘Industry or competitive environment analysis’ of Porter (1980).
His Five Forces’ model of the competitive environment is as follows:
Based on M E Porter (1979), ‘How competitive forces shape strategy’, Harvard Business Review, 57(2), March-April 1979
Figure 6.1
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