As business surroundings become more complicated the strategic management becomes more vital than the past. In general, strategic management deals with managerial decisions and actions that are catered for long-term objectives. Hence, it is a double combination of art and science because it requires managers to think outside the box and the ability to correlate them with supported theories. Normally known, firms that run a business without proper business strategy will result as directionless, hence a more vulnerable to changes in business. In general, strategy serves as a platform for the company which help directs what is needed to be done in order to survive, grow and generate profits. Next, the external environments of a firm consist of majority conditions and forces which in return affect its strategic options and define its competitive surroundings. Thus, constant monitoring and analysis is needed before strategic plan is brought forward.Â According to (Pearce and Robinson, 1995), the business environment can be divided into the remote environment and operating environment. Remote environment comprises of political, economic, social, technological and industry factors. As compared to the remote environment, the operating environment is normally controlled by the firm. Therefore, the operating environment should be more actively processed and monitored to ensure firms are according to track in achieving its objectives. Â The purpose of conducting this studyÂ is to generally provide us aÂ broader better understandingÂ towardsÂ the dynamics and challenges in managing the process of defining and changing organizational strategies.Â Furthermore, the paper highlightsÂ the importance of strategic analysis and problem identification to appropriate strategic decision making.
Get your grade
or your money back
using our Essay Writing Service!
1.1.1 Strategic Management
Strategic management is defined as the lay of endings and actions which are resulted from formulation and implementation process to achieve company's objectives. It consists of several tasks to look at, such as assessing the company's external environment which includes both competitive and related factors. Consequently, it involves both internal and external environmental scanning, strategy formulation strategy implementation, and evaluation and control (Wheelen and Hunger, 2002).
A strategy is a company's game plan does furnish a framework for managerial conclusions and although that plan does not precisely detail all future deployments such as man power, finance, material, it reflects a company's awareness of how, when, and a strategy reflects a company's cognizance of how, when and compared to who it should compete with and for what specific purposes.
1.1.2 Emphasis on environmental factors
Are increases in price of electronic devices the result of economic, political, social, or technology changes? Or are manufacturer's surprisingly good relations with suppliers a result of competitors, customers, or creditors activities or of the suppliers own activities? The answer to both questions lies under the probability answers of forces in the external environment that are combined to create the situation. No doubt, that multiple conditions and forces in the external environment may affect the class of company's mission which in return affect the external environment thus, intensify competitions among in its field of operation. However, are external factors the subject of threats for an agile and dynamic organization?
In fact, certain impact of changes in the external environment can offer a real advantage. It enables conclusion makers to narrow the ambit of the available options. Environmental appraisal rarely recognizes the greatest solution, but it commonly directs problems towards eliminating the scenarios out from the most promising options. It is difficult to precisely anticipate such fluctuation changes in the external environment strategic directors as it often finds. Different external elements bear upon different strategies at different time. The key to strategic forecasting issues for each environmental assessment between remote, industry, and operating lies within the Source for Environmental Forecasting. It is provided to aid strategic directors to identify valuable sources of data and to help strategic directors to identify valuable sources of data points.
1.1.3 Understanding the Swot analysis
As we have been hearing, conducting a SWOT analysis is critically important in conducting a situational analysis. In a brief context, the Strength, Weakness, Opportunities, and Threats helps finds to conduct an assessment in simple processing manner that can offer a variety key advantage to the organization. In other words, it provides the company with powerful insight that would relate to potential and critical issues affecting a venture. It begins by running an inventory internal strength and weakness of a present company. And external factors are being highlighted such as the opportunities and threats that have the high potential effects towards the company which all of this are based on current market position company is in and the overall environment. By capturing the important factors allows organizations to identify and assign each factor (positive or negative) into four identified categories, which as a result allowing company to view overall objectives. In a nutshell, SWOT analysis is a powerful tool in developing, confirming goals, and setting good marketing strategy.
Always on Time
Marked to Standard
1.1.4 Focusing more in depth on External factors
There are many factors that can influence companies' strategy choice making. And many of these factors arise outside the company. In general, there are approximately five broad key external categories that strategic management can identify. They are political, governmental and legal forces, economic forces, social, cultural and demographics forces, technology forces, and competitive forces. These major external forces could impose certain threats towards the process of attainment of overall objectives, or, inversely, promoting opportunities which benefits the company. In another way to put it, external forces gradually affect the focus of the company in strategically managing its core value. It affects the types of products/services the company develops and offers the market positioning and marketing strategies, the relationships between vendors and suppliers, and the nature of alliances in its present forms, and the relationships with customers.
Thus, in order for companies to distance themselves from such issues the company needs to identify and evaluate the pertaining opportunities and also the risk posed by the external forces. The company needs to set a clear vision statement of its mission, have a precise objectives and proper strategies to achieve its stated objectives, and setting an applicable yet relevant policies and procedures for good strategic planning purposes which serves as a way in achieving the company overall detailed objective.
According to Porter Michael, E. (1985), he stresses that the potential greatest risk factors should be highlighted as such that the entity has the capability of responding to either indecently or decently manner through proper strategic planning and management from its business processes towards the risks and opportunities that it encounter. Apart from that, the examples of "Strategic Analysis of External Factors to Consider", developed by Poter's Five-Forces Model table has made it easier for cross referencing in this study purpose.
1.1.5 The nature value of strategic management
Todays' new executive must have the knowledge and quick respond in safe guarding the company against immediate and remote external environments. The immediate external environment includes challengers, providers, increasingly scarce resources, authorities' agencies and their ever more numerous ordinances, and customers whose preferences often change over inexplicably. Whereas, the remote external environment consist of economic and social conditions, political forces, and technological advancements which all of these segments should be viewed, checked, measured, and included into the executive decision making.
Most commonly, executives employs management process which they feel that is optimal solutions in handling factors and conditions that could affect the growth and profitability of the firm. In order for firms to earn profits, it requires them to perfect its processes so that it could make quick responds. Whether to expand its size of business, expand the role of government as a buyer, seller, regulator, and competitor under a free enterprise system which works as a greater international trade.
1.1.6 Strategic Analysis and Choice
A company profile allows a business firm to identify an ambit of possibly attractive interactive chances and simultaneous appraisal of the external environment. In terms of investment, these chances are high changes of generating avenues. Nevertheless, necessarily screening is needed to generate successful set of possible and desired opportunities to supply the mixture of long term objectives.
It is noted that firms who wishes to implement good strategic analysis and choices needs to firstly discover its most optimal strategies that are mostly effective manner in building sustainable competitive advantage. Firms can do as so, if they carry out their strategic analysis and choice based on the key value chain activities and capabilities which are known as core competencies of the firm. Moreover, many multi-business companies suggest that managers will normally focus on certain key questions that relates to a combination of businesses and shareholders value. These in return, help managers to carry out proper strategic analysis and decision making.
1.1.7 Strategic Management as a Process
The main process is the flow of info through interconnected phases of analysis towards the achievement of a goal. For example: Forecast data on the operations and environment of the business and for the strategic management process, the flow of info involves historical and current. These data are being evaluated by managers in order to view the overall values and priorities of influential persons or groups known as stakeholders whom are extremely concerned in the actions that the business does. Implications of viewing strategic management as a process are that strategy formulation and implementation are sequential. It begins with development and reevaluation of the company's mission which is associated by development of company's profile and evaluation of the external environment. And followed in order, strategic choice, definition of long-term objectives, design of the grand strategy, definition of short-term objectives, and design of operating strategies, institutionalization of the strategy, and review and evaluation. Most companies' management seeks over a multilayer period that consists long term objectives. For examples: profitability, return on investment, competitive position, company's productivity level, employee relations, employee development and public responsibility.
This Essay is
a Student's Work
This essay has been submitted by a student. This is not an example of the work written by our professional essay writers.Examples of our work
Firstly, a firm's strategic posture might changes at times due to the principal factors that might affect its performance. For example: new competitor that enters the market, the death of one of the board member, retirement of a chief executive officer, recession, and other unforeseen factors. Nevertheless, a company or corporate will faces various problems along the way and when it comes to strategic management; it all begins with a mission statement.) Not every component in strategic management has the same amount of attention from the company. Departments that are self-sustainable may not need to be reviewed as often as others that are causing the firm to decline. Apart from that, another way of viewing the process of strategic management can be in forms of feedbacks, review, and evaluation in the early stage cycle. Feedback is one of the most useful ways to make analysis of post implementation as it can be used to enhance future decision making. These tools are good for future planning as strategic managers should not neglect in analyzing the impact of strategies which are considered possible needs in modification of the company mission statement. Dynamic system is one of the crucial elements of strategic management as well. The word dynamic means that the changes in the external environments affect the interrelated and interdependent strategic activities. Strategic processes are constantly evolving and since the environment is prone to continuous changes, constant monitoring on the strategic planning process should be done in order to suggestively move any components as precaution against implementing of an outdated strategy.
1.1.8 Changes in the Process
Subtle updating and the strategic management process undergoes continual appraisal. Even though the elements suggest that the general strategic management theoretical account rarely alteration, the relative emphasis that each element receives will vary with the conclusion makers who apply the framework. In strategic management a recent survey describes general trends. Recent update indicated that there has been accumulative companywide emphasis towards escalation of value in strategic management activities. Moreover, there are indications that managers are increasingly giving higher attention in viewing the frequent and widespread involvement in constructing and application phases under the strategic management process. Last but not least, there are sayings that managers becomes better in avoiding potential negative outcomes as they and the present firms gains more knowledge, experience, skills, and understanding in constructing an effective and reliable planning activities.
2.0 Problem Statement
It seems clear that strategic managers' plays a vital role in assuring organization is working towards achieving overall objectives. However, there are many studies indicates that the external environment forces may affect the nature of company's mission which in return affect the external environment thus, intensify competitions among in its field of operation. No doubt, there are such external factors that could hinder good management planning and decisions made by existing firms. However, many firms are looking into ways in managing their risks by substituting opportunities over threats in the external environment. Most corporations often fail to safeguard or maintain itself for a long period because they are unable to manage risk effectively. Thus, there are contents that will be looked into this report. With regard to this, the research problems of this study can be formulated as:
How can business benefit from strategic management?
How company perceives the formation of strategy in today's challenging environment?
Are hypercompetitive conditions in the external factors bad or good for agile and dynamic organizations?
What are the ways that organization can do in dealing with turbulent conditions, rather than the attempts to avoid dealing with the environment?
How does the external factor affect company's flexibility decision making?
3.0 Literature Review
3.1 Managerial decision-making process
In general, the process of managerial decision-making involves decision makers to ultimately identify problems to solutions. Throughout the years, researches has developed different types of decision-making classification schemes such as (Thompson, J.D. 1967) distinguishes four modes of interdepartmental interaction-standards, schedules, mutual adaptation and teams. There are common features which highlights the link between different types of decisions made and the different levels of management at which decisions are taken place. Normally, the tendency of top decision makers tends to be more of a non-routine, non-recurring, and more long-term unpredictable future outcomes. Whereas, lower level managers tends to make decision that are routine, recurring, and short-term based where more certainty is known (Harrison, 1975). Nonetheless on which types of decisions are being made, the desired outcome is the objective of the process. The decision-making process acts as an aid to managers in finding problem-solutions. Thus, whichever process is employed, the end result to it should enable managers to a better accomplishments and organizational goals. However the remaining questions boils down to the stress responsibilities that final decisions makers have to undertake. Also not mentioning the risk involved when there is uncertainty of how the end results will be like?
There are different opinions and ways to conduct strategic management. The research paper that (Frans N. Stokman, Marcel A.L.M. van Assen etl.) conducted was based on some insights gained over the past period development of the methodology which also carries certain collective decision-making model. It is an add on research on carried by (Mokken and Stokman, 1976) which this journal demonstrates that far-reaching insights into the decision-making process can be obtained from a correct problem decomposition, a decomposition resulting in a few main controversial issues, and a proper specification of the decision setting set by stakeholders based on their capabilities, positions, and salience . The research was conducted in a systematic approach which involves at first a decomposition of the problem resulting in the specification of a limited number of main controversial issues to be solved. Subsequently, an analysis of all stakeholders is required, including an overview of their positions, capabilities, and salience on each of the issues. Next, different strategies have to be considered. And models that are particularly useful for evaluating the given strategies. However there are certain important questions remains on whether noncooperative strategies lead to longer and more difficult decision-making processes?
The next journal on Borut Rusjan, (2005) is viewed as to understand a little more in depth on the model purposes of strategic planning. As a summary, this study generally identifies the certain basis to overcome oriented shortcomings in the past empirical research. It was said that the basic assumption on the proposed model serves as an appropriate strategic analysis that is necessary for companies to have reliable strategic decisions. The paper emphasises the importance of strategic analysis and problem identification in suiting decision making. However, the overall paper highlights that changes in strategic manufacturing decision areas by imitating "good" techniques that are implemented by successful companies may lead to disappointing results.
. Moving on, (Rabia Naguib, 2009) is an extension research to study the answers outlined by Papadakis' (1998). The paper followed a multi-method field study combining both qualitative and quantitative methodologies to understand the linkage in a newer perspective. Purpose of this is to examine the linkage between firm performance and the strategic decision-making process. Findings suggested that indeed strategic decision-making in a high-performing firms are more rational, less sensitive, and less political. Fascinatingly, it was indicated that the effectiveness of organizational structure has a stronger predictor of strategic decision-making process dimensions than of financial and business performance. An exploratory paper on David Pollard, Sabine Hotho, (2006), stresses those organisations that employ a strategic approach drives crisis management to embody crisis management processes and planning in the strategy process in dealing with the changes in the external environment. It was suggested that organizations can gain several important advantages through proactive preparation for major relevant contingencies, and its incorporation into the strategic management process (David Pollard, Sabine Hotho, 2006). The study indicates that there are significant advantages that can be obtained in both minimising the possibility of crises when such events are linked to controllable operations of the organisation and to assess proactively those eventualities that may adversely affect the strategic performance of the organisation.
3.2 Strategic management process
Similarly to decision-making process, strategic management process is partially a sub segment of management. According to (Bryson 1995, David 2005) the strategic management process serves as an aid to help organization to distinguish themselves among other players in the market. It assists the organization to have a better capitalized potential among its strength, weakness, opportunities, and threats (Poter, 1985, David 2005). Once again, the similarity between decision-making process and strategic management process circles around in selecting the right alternative choices. In an overall view, there are generally three accepted phase of strategic management process: strategy formulation; strategy implementation; and strategy evaluation (David, 2005). The corporate level strategy consists of the highest direction in the organization which defines the purpose and lines of the businesses to operate in. Operation in a single line of business basically means both corporate-level and business-level strategies are working simultaneously. And if operations are within two lines of business, it would consist of two business level strategies. However, the third level of strategy is distinguished as functional-level strategy. Where each functional area within the organization is indicated with a set of blueprints which indicates how activities should be done in accordance of supporting the organization in accomplishing its business-level and corporate-level strategies. Some study identifies them as decision-flow process. These decision-flow processes are mediums which organization uses to mix end results into rational ways for developing, implementing, and controlling decision making (Raps June 2004). Therefore, it is important to understand the greater course of strategy so that employees can further provide an effective implementation. Higher degree of transparency is required in having fair and clear decision-making process.
If anyone raises the question whether strategic management in decision making and planning can be failed? Hardly anyone is denying that there are possible arguments that hypercompetitive conditions are not threats but an opportunity for agile and dynamic organizations. Moreover, in regards to the external factors that influences decision making, decision makers should conduct a precise analytical study in order to execute an almost excellent strategic management process. However, negative sides arise too. How capable can a managers effectively execute continuous strategic implications? Is there any relation between leadership and successful management strategy which could draw significant difference to how a firm performs?
Several key studies done by (Eduardo Bueno Campos, Ma Paz Salmador Sánchez, 2003) inform that the formation of strategy is essential part in creating distinctive competencies for business. Based on the theory developed by Nonaka and Takeuchi, the study concludes that the formation of the strategy is indeed a being twice as much of knowledge in creating process. Nicholas O'Regan, Abby Ghobadian, (2002), highlights that formal strategic planning is the key to effective business process management. This paper further examines the concept of strategic planning and identifies the barriers to its implementation. The paper suggests that, there are certain key elements in eliminating or reducing implementation barriers that are experienced by high and low performing firms. Micheal Beer specifies in order to transform silent carriers into strengths, firms are required to apply appropriate learning principles and ideal changes. The integrated normative theory for developing an effective organization presented in this study provides managers and their optimal decision making with a framework for conversation about the current state of their organization.
4.0 Research Method
4.1 Research Design
This report presents the methodology used in this study. Upon my studies, I have used a qualitative approach as a direction for carrying out the research. An implication will be provided as a result based accordingly from the data collected in both methods employed. The interview in particular, examines the roles of strategic management in planning an organization's future development by developing knowledge and practice in the application of strategic management concepts and techniques.
Company : Panasonic Malaysia Sdn. Bhd
Interviewee : Mr. Jeff Lee Wee Leong, Managing Director
Interview Approach : Face-to-Face
Location : Oriental Cravings at One-Utama Shopping Mall
Date : October 12, 2012
About the company, Panasonic Malaysia Sdn Bhd is a sales, service and marketing company for the Panasonic brand of electrical and electronic consumer products ranging from home appliances, audio-visual, digital cameras, car entertainment systems, air conditioners, business systems & solutions, telecommunications, professional broadcasting solutions, health and beauty care to batteries and lightings
Brief background of Mr. Jeff Lee Wee Leong:
Mr. Wee Leong Lee referred as Jeff has been The Managing Director of Panasonic Malaysia since April 2010. As accordance to year 2013, that would be a total of 30 years of working experience that Jeff has in Panasonic Malaysia. He graduated with a Bachelor of Science (Biochemistry & Biology) from University of Malaya in 1979.
Since April 2010
Assistant General Manager
Audio/Visual & Technics Musical Instruments
4.2 Question and Answer Colum
Briefly inform what are your main roles in the company? job scope and responsibilities?
Mr. Jeff is in charge of merchandizing division and he is responsible in making sure that all the dealer outlets get the advertising job done. One of the major roles of Mr. Jeff in the organization is to completely foresee the various functional areas, along with ensuring these areas are operating harmoniously together well. Another important role of his is to keep a continuous eye on the goals and objectives of the organization.
As a decision maker, briefly define what is strategic management?
Jeff Lee defines strategy management as a set of actions and decisions made by managerial division that regulates the long-run performance of a corporation or firm. He mentions that strategy provides a direction for the company which indicates what must be done to survive, grow and be profitable. He added that, strategy is widely used by many firms but are often used in a wrong context. Thus, he mentions that firms needs to carefully understand the term. Strategic issues are highlighted as a problem if there is a need of top management participation; major resource commitments are concern, implications on deciding the long term impact of the organization as a whole. Although top executives hold an important position in the company, employees at all divisions or levels in the company should be involved. The decided plans made by the higher authority needs to be understood and clearly being implemented effectively at these lower levels. He mentions that when the company faces an issue or problem or even a big deal to close, they will have to consult our top management. For example: There was once, a buyer came direct to the factory and wanted to order 1000 units of camera, and he brought cash. So the sales staff was happy because he thought he could seal the deal. However, the top management disapproves the sales as there is something not right as the buyer could just buy tons of units and then he could throw price meaning sell it for very cheap price and destruct our dealers' sale.
What are the external forces of Panasonic?
Looking at the PESTLE concept, that is Political, Economical, Social, Technological, Legal and Environmental issue, one of the toughest challenge we face was the shift in technology throughout these decades. Taking for example: 20 years ago, many Panasonic dealers were making big bucks by selling VCR that is video tape, telephone, fax machine, printers; later on, the camera era at the 20th century, but now with the advance technology such as Iphone, it can provide so much to users that they have other alternative and they need not to get a camera.
How company reacts to environmental factors?
Well as you can realize that we are now in a eco-friendly era that means we are producing product that are environmental friendly. Panasonic is trying to be different than others as we are ISO1400 certified and in the near future, cars do not need to use fuel anymore as they use electric charges and battery that are supplied by Panasonic. No doubt, there are numerous external factors that the company is afraid of. However, the best way for the company to distance themselves from such issues the company needs to identify and evaluate the pertaining opportunities and also the risk posed by the external forces. Jeff Lee added, every company needs to set a clear vision statement of its mission, have a precise objectives and proper strategies to achieve its stated objectives, and setting an applicable yet relevant policies and procedures for good strategic planning purposes which serves as a way in achieving the company overall detailed objective.
How is Panasonic managerial decision making process like?
Of course the highest person in charge is the President of Mashushita that is located at OSAKA, therefore, it based down to what sort of decision and whether are we able to bear the responsibility if anything goes wrong
How PanasonicÂ implements or strategic management works in the business context. And how does it affect decision making?
Our company is constraining by top management as in the decisions and how the company runs is very standard as top management from Japan decides. However, whenever we have any suggestion on changes on the business model, we will report up to top management and see whether they approve or not. For example: For us to build the eco center at Selangor, we had to report to top management for approval, however they accepted and only then we can continue with the project
How can business benefit from strategic management?Â
Every company needs strategic management as it is the core to run a company or a big corporation. With strategic management only a company is ready to face any upcoming challenges in the future and prepare to bounce back from any sort of decline of profit or sales.
How company perceives the formation of strategy in today's challenging environment?
Jeff informs that their main objectives for now are to focus more in depth on the ecological factors. Ecological factors generally refer to the relationship among human beings and other living things such as soil, water, air that supports the living. And the human activities are the main threats to their life-supporting ecology. He stretches that by narrowing their core competencies into eco-efficiency will most likely serve them with several strings of advantages. They have come to realize that its business activities should no longer ignore the environmental concerns. Thus, further questions were asked on what makes them to shift their focus point. Jeff replied, the reasons why they are doing so is because there is an increase in the government regulations and consumers are becoming more concern on the environment these days. Hence, this drives them to a rational conclusion that the goal of the business should be limited towards the impact on the environment, thus ensuring long-run benefits to both firms and society. Even now, they have systems in place that has virtually zero CO2 emissions which functions in a way to reduce environmental impact. He further informs that, redefining Panasonic Malaysia's business direction is just the start. The company is in the process of preparing the way for future generations. Which they declare their commitment to be Malaysia's cooperative partner in building an ECONATION (a country that is not just economically sound but also practises sustainability in the way we live and the way we work). In a work in process the managerial teams are working hard in trying to achieve their global vision. Being No.1 green innovation company in the electronics industry by 2018, and be able to proudly celebrate Panasonic Corporation's by its 100th anniversary (Message from Panasonic Malaysia, n.d).
How does it affect company's flexibility in decision making? -knowing that there is huge cultural differences among Malaysia and Japan
Usually to become a regional manager or the managing director of Panasonic, you have to know the read the book written by Mashusita, whereby he had written his 100 year plan for Panasonic. Thus, making decision in such a big corporate, indeed the culture matters as we have to obey their business roots and the way they run their cooperation.
Explain how Panasonic can develop an effective strategic and business approach?
No matter how the working world is changing, there will always be a constant need for succession planning. Jeff mentions that in today's hypercompetitive global economy needs a clear vision on which direction the company wants to be and the strategy serves as a vehicle to deliver those visions. He further adds on that succession comes from many years of planning in advance to reach the expected needs. For this to be executed, firms needs to properly train a successor. In which it requires proper training and development. This means, specific time frame is needed to properly expose the people to the full scale of opportunities within the firm. Moreover, the successor needs to have the desirability and requirements to further enhance his knowledge/education level which can be learned outside. For instance, if someone is position as a general manager, he/she must know the quantity of departments the organization has, the range and types of existing technologies and processes, and high knowledge level of the organization procedures and policies, and etc.
Apart from that, additional factors such as past experience and general knowledge that individual possess will too affect the succession time frame. All in all, if the succession planning is done correctly it will most definitely ease the burden of the senior management in better understanding and expectations he/she has to bring for its future leadership.
Who has the final say in the decision making?
It depends where we stand, if I were the managing director, certain decisions I could make myself, of course with analyzing the risk, if it requires major funding, then I will have to seek for top management. However, our organization runs on all three levels strategy: corporate, business, and functional. This means each functional area is given a directive order from the corporate and business level. This directive order serves as a blueprint which identifies the string of activities that will provide the necessities support in accomplishing its business-level and corporate-level strategies. He further mentions that the ultimate objective to well-structured managerial team is that all employees under the particular division should understand and are working toward the achievement of the organization's mission and goals.
All in all decisions and actions are the first cycle under designing and application of plans to achieve company's long term objectives. Due to the fact that involves long-term, future-orientated, complex decision making and it require considerable recourse, therefore, participation of the top-management is essential. Based from the interview findings, Mr.Lee Wee Leong indicates that the strategic management in Panasonic consists of a three-tier process involving corporate, business, and functional-level planners, and support personnel. And at each level progress, each level receives orders and direction from the above authority and must somehow abide to them. It was indicated that the strategic activities of the lower level were shown to be more specific, narrow, temporary, and action based, has lesser risks but fewer opportunities for dramatic impact. External forces gradually affect the focus of the company in strategically managing its core value. It affects the types of products/services the company develops and offers the market positioning and marketing strategies, the relationships between vendors and suppliers, and the nature of alliances in its present forms, and the relationships with customers. Hence, in order for companies cushion itself against from such issues the company needs to identify and evaluate the pertaining opportunities and also the risk posed by the external forces.