ENVIRONMENTAL

SCANNING
• Careful monitoring of an organization's
internal and external environments for
detecting early signs of opportunities and
threats that may influence its current and
future plans.
 OBJECTIVES
• To understand current and probable
changes in environment.
• To foresee the impact of various
components of business environment.
• To identify the strengths, weaknesses,
threats and opportunities of environment
• To formulate appropriate strategies by
analyzing opportunities and threats to the
business
• To provide inputs for analyzing various
alternatives to chose the best alternative
• To ensure optimum utilization of resources
• To diversify the business in new areas and
to keep the business dynamic
• To promote future oriented thinking and a
proactive attitude amongst the
management and staff
 LIMITATIONS
• The results may prove wrong because an
unexpected changes that may occur in
any area immediately after the scanning
process has been completed.
• Environmental analysis cannot guarantee
organizational effectiveness
• Use of inaccurate data in forecasting will
render environmental analysis unreliable
and ineffective
PROCESS OF ENVIRONMENTAL
SCANNING
1. Defining mission and objectives
2. Formation of scanning team
3. Scanning of internal and external
environment:
• Analysis of resources
• Collection of data
4. monitoring the results of scanning
5. Forecasting the future trends in relevant
environmental factors
6. Assessing implications
7. Defining alternative strategies to achieve
the mission and objectives
 KINDS OF ENVIRONMENTAL
SCANNING
1. Ad-hoc scanning: very short-term
scanning which is done mainly in
situations of emergency or during the
period of crisis
2. Regular scanning: it is related to regular
scanning by the organization. It is done
without any given specific purpose. It is
usually done to update the records for
future.
• Continuous scanning: involves continuous
data collection and analysis with respect to
day-to-day changes in the macro-
environment of the firm. It allows the firm\s
to act quickly , take advantage of
opportunities before the entry of
competitors.
 IMPORTANCE
1. To frame policies and help in decision
making
2. To identify the strengths and
weaknesses of the business
3. To identify the opportunities and threats
faced by the business
4. To analyze competitors strategies
5. To bring innovation and change
6. To know the internal environment
7. To understand market conditions
8. To forecast demand
 TECHNOIQUES OF
ENVIRONMENTAL SCANNING
• 1. SWOT ANALYSIS
• ETOP