As every business is affected by a lot of internal or external forces like economic, social, technological, legal, etc., it becomes important for a business to analyze and study all these forces that may impact the potential future opportunities.
The main aim of environmental scanning is to help the organization determine future opportunities. The environmental scanning committee looks after the affecting forces and trends that are influencing the growth and opportunities of a business. The committee creates an action plan to tackle upcoming events and work on such plans throughout the event. The need for environment scanning is for dynamic environment of a business. The business environment is continuing to change due to all affecting forces. To control the change and future of an organization, environment scanning is important.
Environmental scanning does the regular monitoring of the constantly changing environment of a business. It analyses internal or external forces to identify threats and opportunities. It provides a roadmap to the organization about the future.
Importance of Environmental Scanning
Environmental scanning helps in carefully identifying the threats and opportunities of a business. It helps an organization avoid business losses and stay competitive.
SWOT Analysis – Environmental scanning is a complex process. It needs a close study of all the internal and external forces. The study will reveal valuable information regarding the organization like strengths, weaknesses, opportunities, and threats. This will help an organization to move in a particular direction to achieve its goals.
Survival – The study of environmental forces helps a business to survive in the competitive market. As there is a lot of competition in the market, environmental scanning helps in understanding the trends to use different techniques to tackle the competition. It will also assure business growth.
Decision making – There is no doubt about the fact that environmental scanning plays an significant role in decision-making. It helps the organization to make the best decision because all the things which need to be considered are there. It points out all the threats and weaknesses of a business that helps in making a wise decision.
Techniques of Environmental Scanning
Environmental scanning is done to monitor the economic, social, and technological trends so that an organization can make strategies according to them.
Following are some of the techniques which are used to conduct environmental scanning;
Research – Research is done to understand the latest trends and threats that can easily affect the organization. Understanding the demand, needs, and upcoming trends in products may enhance the profit of an organization. So that opportunities cannot be wasted and effective steps should be taken to reduce the adverse impacts .
SWOT analysis – This analysis is one of the most important method in identifying environmental threats. This is a strategic technique to learn about the strengths, weaknesses, threats, and opportunities of an organization.
PEST Analysis – PEST means for political, economic, social, and technological factors. PEST analysis can be done to identify the external environmental factors that may impact the growth of an organization. A business needs to keep track of all these factors.
Expert opinion – This is another effective technique, which may give an organization lead to understanding the external environment and all the trends better. Experts have deep knowledge and already know about the market trends; they can give a wise opinion.
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