What is environmental scanning? Using the five environmental forces that affect organizations, describe considerations for conducting environmental scanning for a new model of automobile.

Question

What will be an ideal response?

Answer 1

Environmental scanning involves the acquisition of information about events occurring outside an organization to identify and interpret potential trends that might present opportunities or threats to be managed by the firm. In the case of a new model automobile, environmental forces can include the following: (1) Social - Crowdfunding, online concept testing, and preordering are becoming important ways for consumers to participate in brand and product development. (2) Economic - The U.S., Japan, China, and EU countries will increase investments in sustainable living infrastructure. (3) Technological - Robots are becoming viable technologies for housework, surgery, and many forms of labor. (4) Competitive - Customer generated content (feedback, reviews, etc.) is growing as a competitive advantage. (5) Regulatory - There is increasing regulatory guidance regarding green and environmental marketing claims. See Figure 3-2 in the textbook.