An activity that is performed without knowing what you will find out.
Surveillance of a firm's external environment to predict environmental changes and detect changes already underway.
Alerts to critical trends and events that may affect the firm's business before competitors.
Otherwise, it would be a reactive model.
Requires a combination of knowing your business and your customers, and keeping an eye on what's happening.
Scan to be the first to know about things that are happening.
Environmental Monitoring
Tracks the evolution of environmental trends, sequences of events, or streams of activities.
Enables firms to evaluate how trends are changing the competitive landscape.
Competitive Intelligence
Competitive intelligence of the whole business system.
Helps firms define and understand their industry and identify rivals' strengths and weaknesses.
Includes collecting and interpreting data on competitors.
Helps a company anticipate competitors' moves and decrease response time.
Environmental Forecasting
Involves the development of projections about the direction, scope, speed, and intensity of environmental change.
How long will it take a new technology to reach the market? Will the present social concern about an issue result in new legislation? Are current trends likely to continue?
Uncertainty plays a major role and may pose wrong scenarios.
Strategies in the Introduction Stage
Characterized by:
New products not known to customers.
Poorly defined market segments.
Unspecified product features.
Low sales growth.
Rapid technological change.
Operating losses.
Need for financial support.
Success requires an emphasis on R&D and marketing activities.
There are benefits and damages for both being a "first mover" or a "last mover".
Strategies in the Growth Stage
Characterized by:
Strong increases in sales.
Growing competition.
Developing brand recognition.
A need for financing complementary value-chain activities: marketing, sales, and customer service.
Success requires increases in the proportion of repeat buyers to new purchasers.
Strategies in the Maturity Stage
Characterized by:
Slowing demand growth.
Saturated markets.
Direct competition.
Price competition.
Strategic emphasis on efficient operations.
The only way to win is to take market share from the competition.
By repositioning products, firms can reset from the product life cycle and exit (partially) from the mature market.
Strategies in the Decline Stage
Characterized by:
Falling sales and profits.
Increasing price competition.
Industry consolidation.
Motivated by changes in consumer tastes or technological innovation.
Firms should decide either to exit or to stay and attempt to consolidate their position in the industry.
