Podcast
Questions and Answers
What is the primary purpose of stakeholder analysis in organisations?
What is the primary purpose of stakeholder analysis in organisations?
Which of the following stakeholders is likely to have resource power over an organisation?
Which of the following stakeholders is likely to have resource power over an organisation?
What is the primary purpose of a PEST analysis?
What is the primary purpose of a PEST analysis?
Which stakeholders are likely to have formal power over an organisation?
Which stakeholders are likely to have formal power over an organisation?
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What is the primary purpose of stakeholder mapping?
What is the primary purpose of stakeholder mapping?
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Which of the following is a key aspect of external environment analysis?
Which of the following is a key aspect of external environment analysis?
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Which of the following is NOT a component of the general environment in PEST analysis?
Which of the following is NOT a component of the general environment in PEST analysis?
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What is the primary focus of Porter's Five Forces analysis?
What is the primary focus of Porter's Five Forces analysis?
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Which of the following is an example of a socio-cultural factor that can influence an organisation?
Which of the following is an example of a socio-cultural factor that can influence an organisation?
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What is the main difference between a static and dynamic environment?
What is the main difference between a static and dynamic environment?
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Which of the following is a component of Porter's Five Forces analysis?
Which of the following is a component of Porter's Five Forces analysis?
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What is the primary purpose of conducting environmental analysis?
What is the primary purpose of conducting environmental analysis?
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Which of the following is an example of a technological factor that can influence an organisation?
Which of the following is an example of a technological factor that can influence an organisation?
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What is the main benefit of using PEST analysis?
What is the main benefit of using PEST analysis?
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Which of the following is NOT a component of the competitive environment?
Which of the following is NOT a component of the competitive environment?
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What is the main difference between a simple and complex environment?
What is the main difference between a simple and complex environment?
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What is the primary purpose of undertaking a PEST analysis?
What is the primary purpose of undertaking a PEST analysis?
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Which of the following is NOT a component of the general (macro) environment?
Which of the following is NOT a component of the general (macro) environment?
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What is the primary focus of stakeholder analysis?
What is the primary focus of stakeholder analysis?
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Which of Porter's five forces is concerned with the threat of new entrants into an industry?
Which of Porter's five forces is concerned with the threat of new entrants into an industry?
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What is the primary purpose of environmental analysis?
What is the primary purpose of environmental analysis?
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Which of the following is an example of a stakeholder?
Which of the following is an example of a stakeholder?
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Study Notes
Organisations and the Competitive Environment
- The topic covers the main forces that affect organisational performance, PEST analysis, Porter's five forces model, and stakeholder analysis.
Environmental Forces
- Environmental forces exist at different levels: general (macro), competitive, internal, and stakeholders.
- Each level has a distinct impact on organisational performance.
General (Macro) Environment
- Political-legal factors: employment law, taxation policy, company law, and environmental legislation.
- Economic factors: interest and inflation rates, consumer confidence, and economic growth prospects.
- Socio-cultural factors: demographics, values in society, and changing lifestyles.
- Technological factors: new product potential, alternative means of providing services, and new discoveries.
Competitive Environment
- Buyers/customers: purchasing power and loyalty.
- Suppliers: bargaining power and reliability.
- Competitors: rivalry and market share.
- Substitute goods or services: alternatives and switching costs.
Why is Environmental Analysis Important?
- Environmental analysis is crucial for identifying opportunities and threats.
- Data sources should be both internal and external.
- Frequency of analysis is typically every three to five years.
- Forecasting and scenario planning involve analysis of past trends, demographic characteristics, and assumptions.
Stakeholder Analysis
- Stakeholders are internal and external individuals or groups with interests in the organisation.
- Interests may conflict, and some stakeholders have more influence than others.
- Stakeholder expectations should be managed, with priority given to those with more influence.
Examples of Stakeholder Expectations
- Shareholders: growth in dividend payments, growth in share price, and growth in net asset value.
- Suppliers: timely payment, adequate liquidity, and integrity of directors.
- Government: adhering to laws, paying taxes, and environmental sustainability.
- Customers: competitive pricing, product quality, and return and replacement policies.
- Employees: good compensation, job security, and opportunities for personal development.
- Lenders: liquidity, potential to repay interest and capital on due date.
External Stakeholder Power
- Formal power: exercised by stakeholders who are members of influential bodies or committees.
- Resource power: large manufacturers may dictate product quality and prices.
- Expert power: stakeholders with superior knowledge of customers can dictate terms.
Stakeholder Mapping
- The Power/Interest Matrix is used to categorise stakeholders based on their level of power and interest.
- Stakeholders are grouped into four categories: minimal effort, keep informed, keep satisfied, and key players.
Porter's Five Forces Analysis
- The analysis considers forces in the immediate competitive environment.
- The five forces determine the state of competition in an industry: threat of new entrants, bargaining power of suppliers, intensity of current rivalry, bargaining power of buyers, and threat of substitute products.
- The collective strength of the five forces determines industry profitability.
The Five Forces of Industry Competition
- Threat of new entrants: high entry barriers or low entry barriers.
- Bargaining power of suppliers: weak suppliers or strong suppliers.
- Bargaining power of buyers: weak buyers or strong buyers.
- Threat of substitute products: few possible substitutes or many possible substitutes.
- Competitive rivalry: little rivalry or intense rivalry.
Organising Environmental Analysis
- Responsibility: who will undertake the analysis?
- Data sources: internal and external sources.
- Frequency of analysis: typically every three to five years.
- Forecasting and scenario planning: based on analysis of past trends, demographic characteristics, and assumptions.
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Description
This quiz assesses your understanding of organisational stakeholders, data sources, and planning strategies. It covers concepts from Lecture 5, including stakeholder analysis and forecasting techniques.
