Question

Select a specific company of your choice. Read about this company and its current position. Based on your study, identify some of the important macro environmental opportunities and threats for this company.

 

30 Oct 2017
Answer :
Word Count : 3684

Out of complete SWOT analysis, here just Opportunities and threats have been asked about the organization you would be citing here. Have a look at the macro environmental opportunities and threats then edit your answer in your own words to complete the solution. You can take any organization, no matters how big or small it is (even the company you are working with can be taken as example).

Macro environmental opportunities & threats

An organization's macroenvironment consists of nonspecific aspects in the organization's surroundings that have the potential to affect the organization's strategies. When compared to a firm's task environment, the impact of macroenvironmental variables is less direct and the organization has a more limited impact on these elements of the environment.

Macroenvironmental variables include sociocultural, technological, political-legal, economic, and international variables. A firm considers these variables as part of its environmental scanning to better understand the threats and opportunities created by the variables and how strategic plans need to be adjusted so the firm can obtain and retain competitive advantage.

The macroenvironment consists of forces that originate outside of an organization and generally cannot be altered by actions of the organization. In other words, a firm may be influenced by changes within this element of its environment, but cannot itself influence the environment. The curved lines in Figure 1 indicate the indirect influence of the environment on the organization.

SOCIOCULTURAL FACTORS

The sociocultural dimensions of the environment consist of customs, lifestyles, and values that characterize the society in which the firm operates. Socio-cultural components of the environment influence the ability of the firm to obtain resources, make its goods and services, and function within the society. Sociocultural factors include anything within the context of society that has the potential to affect an organization. Population demographics, rising educational levels, norms and values, and attitudes toward social responsibility are examples of sociocultural variables.

POPULATION CHANGES.

Changes in population demographics have many potential consequences for organizations. As the total population changes, the demand for products and services also changes. For instance, the decline in the birthrate and improvement in health care have contributed to an increase in the average age of the population in the United States. Many firms that traditionally marketed their products toward youth are developing product lines that appeal to an older market. Clothing from Levi Strauss & Co. was traditionally popular among young adults. While its popularity in this market has waned, the firm has been able to develop a strong following in the adult market with its Dockers label.

Other firms are developing strategies that will allow them to capitalize on the aging population. Firms in the health-care industry and firms providing funeral services are expected to do well given the increasing age of the U.S. population. They are projected as a growth segment of U.S. industry simply because of the population demographics.

RISING EDUCATIONAL LEVELS.

Rising educational levels also have an impact on organizations. Higher educational levels allow people to earn higher incomes than would have been possible otherwise. The increase in income has created opportunities to purchase additional goods and services, and to raise the overall standard of living of a large segment of the population. The educational level has also led to increased expectations of workers, and has increased job mobility. Workers are less accepting of undesirable working conditions than were workers a generation ago. Better working conditions, stable employment, and opportunities for training and development are a few of the demands businesses confront more frequently as the result of a more educated workforce.

NORMS AND VALUES.

Norms (standard accepted forms of behavior) and values (attitudes toward right and wrong), differ across time and between geographical areas. Lifestyles differ as well among different ethnic groups. As an example, the application in the United States of Japanese-influenced approaches to management has caused firms to reevaluate the concept of quality. Customers have also come to expect increasing quality in products. Many firms have found it necessary to reexamine production and marketing strategies to respond to changes in consumer expectations.

SOCIAL RESPONSIBILITY.

Social responsibility is the expectation that a business or individual will strive to improve the welfare of society. From a business perspective, this translates into the public expecting businesses to take active steps to make society better by virtue of the business being in existence. Like norms and values, what is considered socially responsible behavior changes over time. In the 1970s affirmative action was a high priority. During the early part of the twenty-first century prominent social issues were environmental quality (most prominently, recycling and waste reduction) and human rights, in addition to general social welfare. More than just philanthropy, social responsibility looks for active participation on the part of corporations to serve their communities.

The stakeholder approach to social responsibility demonstrates some of the complexities of incorporating socially responsible issues into a firm's strategies. Stakeholders are anyone with a stake in the organization's existence. Highly visible stakeholders are stockholders, employees, customers, and the local community. Decisions to be responsible and maximize the return to stockholders may require closing an unprofitable plant. However, employees and members of the local community could view this move as socially irresponsible since the move would not benefit the community.

TECHNOLOGICAL FACTORS

Technology is another aspect of the environment a firm should consider in developing strategic plans. Changing technology may affect the demand for a firm's products and services, its production processes, and raw materials. Technological changes may create new opportunities for the firm, or threaten the survival of a product, firm, or industry. Technological innovation continues to move at an increasingly rapid rate.

DEMAND.

Technology can change the lifestyle and buying patterns of consumers. Recent developments in the field of microcomputers have dramatically expanded the potential customer

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