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ETOP

Environmental Threat and Opportunity


Profile (ETOP)
 An environmental threat and opportunity profile is a description of
the structure of external factors.
 Multiple Reasons for an ETOP
1. It helps the organization to identify opportunities and threats
2. Consolidates and strengthens an organization’s position
3. Provides strategists information on which sectors have a
favorable impact on the organization
4. The organization gains knowledge of its standing with respect to
its environment
5. Helps formulate strategies.
Steps in an ETOP
1. Identifymajor Environmental factors such as:
economic, political, social, technological, competitive,
geographical, etc.

2. Environmental factors are then sub-divided into


subsectors of each factor.

3. These factors are then analyzed to determine major


weaknesses and strengths in each of the subsectors.

4. The impact of each factor is then accessed as being


either favorable, unfavorable, or neutral.
Economic Factors
 Economic factors affect the purchasing
power of potential customers and the
firm’s cost of capital.
 These factors include: business cycle,
inflationary trends, consumption,
employment, investment, monetary, legal
and fiscal policies.
Political Factors
 Political factors are how and to what
degree government intervenes in the
economy.
 Political factors include: political power,
ideologies, interest groups, social
stability, legislation, and regulation.
Social Factors
 Social factors impact an organization due
to the social, cultural, demographic, and
environmental profiles in the industry.
 Social factors include: age distribution,
geographic distribution, income
distribution, mobility, education, family
values, and business attitudes.
Technological Factors
 Technological factors impact how an
organization or company operates in
relation to equipment used in the
company’s environment.
 Technological Factors include: rate of
technological change, future raw material
availability, raw material cost,
technological developments, and product
life cycle.
Geographical Factors
 Geographical Factors are important to the
overall analysis of a company.
 Geographical factors include:
plant/warehouse location, relocation of
facilities, headquarters, and foreign
markets.
Managerial Factors
 The Scientific Method

 Teams

 Diversity
Technical Factors

 Manufacturing
 Facilities

 Collaboration
Assessment

 Importance of Culture

 Compatibility with Strategic Change

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