chapter 3: EVALUATING A COMPANY’S EXTERNAL ENVIRONMENT

This entry will show you about EVALUATING A COMPANY’S EXTERNAL ENVIRONMENT. This topic describes about the PESTEL and the Porter's Five - Forces .

What is PESTEL? What is Porter's Five - Forces? Read further and i'll show you my dear ;)

The macro-environment encompasses the broad environmental context in which a company’s industry is situated that includes strategically relevant components over which the firm has no direct control.

 PESTEL analysis focuses on the six principal components of strategic significance in the macro-environment:

PESTEL

Porter's Five - Forces

USING THE FIVE-FORCES MODEL OF COMPETITION

step 1: For each of the five forces, identify the different parties involved, and the specific factors that bring about competitive pressures.

step 2: Evaluate how strong the pressures stemming from each of the five forces are (strong, moderate, or weak).

step 3: Determine whether the collective strength of all five competitive forces is conducive to earning attractive profits in the industry.

Thus, now i can see how to evaluate a company's external environment. I'm pretty sure that you also can understand it. I can feel that this subject started to attract me. Many interesting things i learnt from it. Okay i feel sleepy right now. See you soon. goodnight love!