BUSI 4940 EXAM 1 COMPLETE STUDY
GUIDE QUESTIONS AND VERIFIED
ANSWERS
●● Industry Environment
Answer: Factors that directly affect the company's competitive actions
and responses. But the company CAN have a significant effect back on
them as well.
Think the threat of new entrants, the power of suppliers and buyers, the
threat of substitutes, and rivalry among competing firms.
There are some actions suppliers can take that will affect your company,
but there are also actions you can take to affect your suppliers.
Furthermore, customers can also affect you, but you can also affect your
customers.
●● Competitor Analysis
Answer: How companies gather and interpret information about their
competitors is called ______________________.
●● General Environment
Answer: The following are external factors that are Segments and
Elements of the _______________.
,1. Political/Legal
2. Economic
3. Sociocultural
4. Technological
5. Demographic
6. Environmental
7. Global
We want to know if these will change and how they will affect our firm
in the next 5 years.
●● Opportunity
Answer: A condition in the general environment that, if exploited
effectively, helps a company reach strategic competitiveness.
●● Threat
Answer: A condition in the general environment that may hinder a
company's efforts to achieve strategic competitiveness.
●● External Environment Analysis
Answer: This process is _____________________,
,1. Scanning: Identifying early signals of environmental changes and
trends
2. Monitoring: Detecting meaning through ongoing observations of
environmental changes and trends.
3. Forecasting: Developing projections of anticipated outcomes based on
monitored changes and trends.
4. Assessing: Determining the timing and importance of environmental
changes and trends for firms' strategies and their management.
●● Demographic
Answer: Segment of General Environment concerned with statistics
regarding:
1) Population Size;
2) Age Structure;
3) Geographic Distribution;
4) Ethnic Mix;
5) Income Distribution
*Remember P. E. S. T. /D. E. G.
, ●● Economic
Answer: Segment of General Environment that refers to the nature and
direction of the economy in which a firm competes or may compete;
Interest rates, inflation rates, GDP, Budget deficits/surpluses, personal
savings rates, unemployment.
*Remember P. E. S. T. /D. E. G.
●● Political/Legal
Answer: Segment of General Environment that refers to tax policies,
trade restrictions, tariffs, subsidies, stability of the government, antitrust,
health & safety, discrimination, child labor.
Likely the most impactful potential issues a firm may face come from
this segment.
*Remember P. E. S. T. /D. E. G.
●● Sociocultural
Answer: Segment of General Environment concerned with a society's
attitudes and cultural values; Women in the workforce, diversity, shifts
in preferences regarding product/service, work-life balance attitudes.
GUIDE QUESTIONS AND VERIFIED
ANSWERS
●● Industry Environment
Answer: Factors that directly affect the company's competitive actions
and responses. But the company CAN have a significant effect back on
them as well.
Think the threat of new entrants, the power of suppliers and buyers, the
threat of substitutes, and rivalry among competing firms.
There are some actions suppliers can take that will affect your company,
but there are also actions you can take to affect your suppliers.
Furthermore, customers can also affect you, but you can also affect your
customers.
●● Competitor Analysis
Answer: How companies gather and interpret information about their
competitors is called ______________________.
●● General Environment
Answer: The following are external factors that are Segments and
Elements of the _______________.
,1. Political/Legal
2. Economic
3. Sociocultural
4. Technological
5. Demographic
6. Environmental
7. Global
We want to know if these will change and how they will affect our firm
in the next 5 years.
●● Opportunity
Answer: A condition in the general environment that, if exploited
effectively, helps a company reach strategic competitiveness.
●● Threat
Answer: A condition in the general environment that may hinder a
company's efforts to achieve strategic competitiveness.
●● External Environment Analysis
Answer: This process is _____________________,
,1. Scanning: Identifying early signals of environmental changes and
trends
2. Monitoring: Detecting meaning through ongoing observations of
environmental changes and trends.
3. Forecasting: Developing projections of anticipated outcomes based on
monitored changes and trends.
4. Assessing: Determining the timing and importance of environmental
changes and trends for firms' strategies and their management.
●● Demographic
Answer: Segment of General Environment concerned with statistics
regarding:
1) Population Size;
2) Age Structure;
3) Geographic Distribution;
4) Ethnic Mix;
5) Income Distribution
*Remember P. E. S. T. /D. E. G.
, ●● Economic
Answer: Segment of General Environment that refers to the nature and
direction of the economy in which a firm competes or may compete;
Interest rates, inflation rates, GDP, Budget deficits/surpluses, personal
savings rates, unemployment.
*Remember P. E. S. T. /D. E. G.
●● Political/Legal
Answer: Segment of General Environment that refers to tax policies,
trade restrictions, tariffs, subsidies, stability of the government, antitrust,
health & safety, discrimination, child labor.
Likely the most impactful potential issues a firm may face come from
this segment.
*Remember P. E. S. T. /D. E. G.
●● Sociocultural
Answer: Segment of General Environment concerned with a society's
attitudes and cultural values; Women in the workforce, diversity, shifts
in preferences regarding product/service, work-life balance attitudes.
