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Macro Environment Analysis

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Macro environment analysis:

When it comes to environmental analysis, we usually refer to the macro environment, but also include industry and competition analysis, product innovation, consumer analysis, and the company’s internal environment. Macro environmental scanning involves analyzing:

1. Economy
(a) GDP per capita
(b) Economic growth
(c) Unemployment Rate
(d) Inflation rate
(e) Consumer and investor confidence
(f) Inventory levels
(g) Currency exchange rates
(h) Merchandise trade balance
(i) Financial and political health of business partners
(j) Balance of payments
(k) Future trends

2. Government
(a) Political climate – amount of government activity
(b) Political stability and risk
(c) Government debt
(d) Budget deficit or surplus
(e) Corporate and personal tax rates
(f) Payroll taxes
(g) Import tariffs and fees
(h) Export restrictions
(i) Restrictions on international financial flows

3. Legal
(a) Minimum wage laws
(b) Environmental protection laws
(c) Worker safety laws
(d) Laws of the Union
(e) Copyright and patent laws
(f) Antitrust laws Notes
(g) Sunday closing laws
(h) Municipal licenses
(i) Laws that favor business investment

4. Technology
(a) Infrastructure efficiency, including: roads, ports, airports, rolling stock, hospitals, education, health, communication, etc.
(b) Industrial productivity
(c) New manufacturing processes
(d) New products and services of the competition
(e) New products and services of supply chain partners
(f) Any new technology that may affect the company.
(g) Cost and accessibility of electric energy.

5. Ecology
(a) Ecological concerns that affect the production processes of companies.
(b) Ecological concerns that affect customer buying habits.
(c) Ecological concerns that affect the perception of customers of the company or product

6. Sociocultural

Demographic factors such as:
(a) Population size and distribution
(b) Age distribution
(c) Education levels
(d) Income levels
(e) Ethnic origins
(f) Religious affiliations

Attitudes towards:
(a) Materialism, capitalism, free enterprise
(b) Individualism, family role, government role, collectivism
(c) Role of the church and religion.
(d) Consumerism
(e) Environmentalism
(f) Importance of work, pride of accomplishment

Cultural structures that include:
(a) Diet and nutrition
(b) Housing conditions

7. Potential suppliers

Job offer
(a) Amount of available labor
(b) Quality of available labor
(c) Stability of the labor supply
(d) Salary Expectations
(e) Employee turnover rate
(f) Strikes and labor relations
(g) Educational facilities

Material suppliers
(a) Quality, quantity, price and stability of material inputs
(b) Delays in delivery
(c) Proximity of bulky or heavy material inputs
(d) Level of competition between suppliers

Service providers
(a) Quantity, quality, price and stability of service facilitators
(b) Special requirements

Concerned parties
(a) Lobbyists
(b) Shareholders
(c) Employees
(d) Partners

Although the analysis of these macro environmental variables in search of threats and opportunities requires that each problem be classified into two dimensions. It must be qualified according to its potential impact on the company and according to its probability of occurrence. Multiplying the potential impact parameter by the probability of occurrence parameter gives us a good indication of its importance to the organization.

Also read: Types of EnvironmentMicro EnvironmentMacro EnvironmentSocio-Cultural EnvironmentRecent developments in economic environmentEnvironmental AnalysisETOP (Environmental Technology Opportunities Portal)

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