BUSI770DB3

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School of Business, Liberty University Faizan Malik Week 3 Discussion Assignment Author Note: Faizan Malik I have no known conflict of interest to disclose. Correspondence concerning this article should be addressed to Faizan Malik: Fmalik@Liberty.edu Introduction The proper evaluation of external environments is crucial for the success of any business, as it provides organizations the opportunity to identify and assess both threats and opportunities that can impact daily operations or the entirety of the business. The combination of fierce competition, globalization, and changing consumer demands make the need for such proper evaluation that much greater, as those who fail to adapt often fall into obsoletion. Gamble et al. (2021) provide insight into how an organization can evaluate its external environment through a multistep process that governs potential threats from ideation to mitigation with tools such as PESTEL analysis and morphological box and scamper decision models. By doing so, organizations can be ahead of potential trends, be aware of disruptions within the market, and adjust business strategies as needed. Process: Evaluating the External Environment The ability to properly assess its external environment is crucial for the success and sustainability of any organization, as it allows it to identify both threats and opportunities that can impact its business. Gamble et al. (2021) outline a multi-step process that allows organizations to make strategic decisions and evaluate their external environment to stay ahead of emerging trends and easily adapt to changes in market trends. The authors recommend that organizations first “identify factors in a company’s broad macro-environment that may have strategic significance” to their business and/or performance (Gamble et al., 2021) and then analyze each factor in detail to determine potential trends and/or developments. This includes PESTEL analysis in which organizations analyze external political, economic, social, technological, legal, and environmental factors that can impact the business. After an organization has identified and analyzed relevant factors, Gamble et al. (2021) suggest organizations analyze both their competition and customers, evaluating the strengths and weaknesses of their competition and the needs and preferences of their customers (Gamble et al., 2021). This can include using Porter’s five forces to assess one’s competition, a framework that

allows an organization to assess its competition and is “considered applicable to every industry, regardless of the level of technology or economic development” (Isabelle et al., 2020). Porter’s five forces include the competitive pressure that arises from buyer bargaining power or the extent to which buyers can influence the prices and quality of products or services, competitor’s substitute products, or the extent to which alternative products or services can satisfy the same customer needs, supplier bargaining power or the extent to which suppliers can influence the prices and quality of inputs, new entrants into the industry or the likelihood of new competitors entering the market and increasing competition, and rivalry amongst competitors or the extent to which competitors are actively competing for market share and customers (Gamble et al., 2021). Gamble et al. (2021) then suggest that organizations map the market positions of key groups of their industry rivals and then “identify which rivals are similarly positioned and are thus close rivals and which are distant rivals” with those closest to others on a map often having stronger cross-group competitive rivalries (Gamble et al, 2021). This allows organizations to understand how they compare to their competitors in terms of factors such as innovation or customer service and adjust their prioritization as needed. Gamble et al. (2021) highlight the benefits of utilizing Porter’s five forces and mapping market position which include the ability to identify driving forces, or “powerful change agents that influence reshaping the industry landscape and altering competitive conditions” and key success factors, which are “competitive factors that most affect industry members’ ability to prosper in the marketplace” (Gamble et al., 2021). Strategic Thinking: Discussion of a Key Source of Weakness As mentioned, Porter’s five forces provide a framework for organizations to identify and analyze competitive forces that are impacting their business, from which they establish their corporate strategies. The force of new entrants, specifically, can highlight weaknesses within an existing business or shortcomings of an entire industry. Gamble et al. (2021) explain that the level of threat a new entrant possess is dependent on two factors, “the expected reaction of incumbent firms to new entry and barriers to entry” (Gamble et al., 2021). When barriers to make entry into a specific industry are low, new businesses can easily enter and the market becomes more saturated. For any organization within a market with low barrier entries, weaknesses within the business are magnified with unique advantages, and product differentiation becomes more difficult. History is plagued with complacent businesses that did not accurately anticipate threats posed by new competition within their market, ultimately leading to their obsoletion. As such, organizations should remain agile and proactive in identifying internal weaknesses that could be exploited by new entrants into the market. Gamble et al. (2021), highlight several approaches for increasing barriers for new entrants which include economies of scale, access to distribution channels, regulatory requirements, and patents or proprietary technology (Gamble et al., 2021). Additionally, an internal focus can mitigate the effects of new entrants, specifically when organizations look to improve their brand equity and differentiate their products from competitors. In a study performed by Wood et al. (2021), researchers found that one of the critical aspects for creating barriers to entry is the “developing and protecting brand equity is product differentiation,” noting that product consistent plays a role as well in customer retention (Wood et al., 2021). With the proper brand equity and effective

product differentiation, new entrants have a harder time entering markets, offering or replicating products, and unseating loyal customers. Decision Model PESTEL analysis is one the best decision models to utilize when attempting to assess external environments, as provides a comprehensive view into external factors that can impact a business on varying levels. The proactive nature of PESTEL analysis supports both strategic decision-making and long-term business planning by forcing organizations to gain insight into forces outside of their control and develop plans to address potential threats. However, PESTEL analysis is not without its detriments, as organizations can under-or-over analyze their data and produce unneeded or undesired results. As such, organizations should also consider the morphological box and scamper decision model in which the organization first explores all possible combinations of scenarios based on varying factors and then ask specific questions to modify an existing idea or product (Krogerus & Tschäppeler, 2017). The questions, which derive from the SCAMPER acronym, cover areas of substitution, combination, adaptation, modification, repurposing (putting to other use), elimination, and reversal of order (Krogerus & Tschäppeler, 2017). With external factors often being unpredictable, organizations should use a combination of decision models when making business decisions. Conclusion According to Keller (2014), “wisdom is more than just obeying God’s ethical norms; it is knowing the right thing to do in the 80 percent of life’s situations in which the moral rules don’t provide the clear answer,” with wisdom coming through years of experience (Keller, 2014). Since organizations have no control over their external environment, sudden changes or unforeseen circumstances can derail the most successful of businesses. Like with the wisdom God gave us, responses to changes in the external environments are not provided to businesses in advance but rather when He intends them to. By utilizing tools just as PESTEL analysis and the morphological box and scamper decision models, organizations can prepare their business for situations where a “clear answer” may not be available. Being prepared for such events is often the key differentiator between businesses that have sustained success and those that fall into obsoletion. References Gamble, J., Peteraf, M., & Thompson, A. (2021), Essentials of strategic management , McGraw- Hill Course Content Delivery (7th ed.), New York, NY. ISBN: 9781260785791. Isabelle, D., Horak, K., McKinnon, S., & Palumbo, C. (2020). Is Porter's Five Forces Framework Still Relevant? A study of the capital/labour intensity continuum via mining and IT industries. Technology Innovation Management Review , 10 (6). Keller, T. (2014), Every good endeavor: Connecting your work to God's work , Riverhead Books, New York, NY. ISBN: 9781594632822.

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Krogerus, M., & Tschäppeler, R. (2017), The decision book: 50 models for strategic thinking., W.W. Norton & Co. (Revised ed.), New York, NY. ISBN: 9780393652376. Wood, B., Williams, O., Nagarajan, V., & Sacks, G. (2021). Market strategies used by processed food manufacturers to increase and consolidate their power: a systematic review and document analysis. Globalization and health , 17 (1), 1-23. School of Business, Liberty University Faizan Malik Week 4 Discussion Assignment Author Note: Faizan Malik I have no known conflict of interest to disclose. Correspondence concerning this article should be addressed to Faizan Malik: Fmalik@Liberty.edu Introduction An organization’s internal environment carries equal significance to the external, as it provides businesses with the opportunity to assess potential risks and/or weaknesses that can impact the performance of the organization. To properly evaluate the internal environment, Gamble et. al (2021) recommend a multistep process that assesses a business’s current strategy, including its existing resources and capabilities, and position within their respective markets (Gamble et al., 2020). In this process, managerial intervention addresses any outstanding issues, with tools such as SWOT analysis, and highlights the source of power that exists with strong organizational leadership. Process: Evaluating the Internal Environment The ability to identify and evaluate one’s internal environment is crucial for the success and sustainability of any business, as doing so allows the organization to identify its core competencies and areas that require improvement. Gamble et al. (2020) describe an analytic process for the evaluation of an organization’s internal environment which includes assessments of how well the current business strategy working, the existing resources and capabilities, cost structure and customer value proposition, strength against the competition, and other strategic issues that require intervention (Gamble et al., 2020). To understand how well an organization’s current strategies are working, Gamble et al. (2020) go on to explain that the business’s ability to

be profitable and improve its position amongst competitors within their market are often the strongest indicators of success. (Gamble et al., 2020), as these indicate whether a business can cover its expenses and grow and decrease the risk of going into obsoletion respectively. Organizations can then look to perform a resource and capability analysis, which can be used to “ascertain which of a company’s resources and capabilities are competitively valuable and to what extent they can support a company’s quest for a sustainable competitive advantage over market rivals.” (Ahmed & Siddiqui, 2020). Organizations should then begin to evaluate their internal environment and how it relates to their competition, specifically evaluating factors such as cost structure, customer value proposition, and overall strength against competition. Cost structure, which refers to the overhead incurred by a business to provide goods and services, and customer value proposition, or the benefits a business can offer their customers, allow organizations to identify competitive areas that require improvement to increase profitability. Gamble et al. (2020) then recommend organizations assess their competitive strength in relation to their key rivals, which includes creating an assessment of the business’s overall competitive strength (Gamble et al., 2020). This is echoed by Rumelt (2011), who explains that an organization’s position relative to its competitors is a critical factor in determining success and requires businesses to assess their competitive strengths and weaknesses, including products, services, strengths, weaknesses, and market positioning (Rumlet, 2011). Finally, explained as the most critical step in assessing an internal environment by Gamble et al. (2021), is determining which strategic organizational issues require managerial intervention which “sets the agenda for deciding what actions to take next to improve the company’s performance and business outlook” (Gamble et al., 2020). Strategic Thinking: Discussion of a Key Source of Power Rumlet (2011) explains the significance of organizational leadership, as they are responsible for creating the business’s identity, communicating strategy, creating a culture aligned with the organization’s mission and values, and effectively managing change or resistance to new strategies (Rumlet, 2011). Strong leadership is one of the key sources of power when evaluating internal environments, as they can influence an organization’s culture, business strategy, and subsequent performance. As stated by Kazmi and Naaranoja (2015), “Leaders, considered as the builders and reformers of the organization ́s internal environment, possess the ability to enhance and establish stronger connection between organizational processes and the team workers ́ ability of learning to think strategically” (Kazmi & Naaranoja, 2015). In addition to being the foundation for organizational stability, the significance of leadership is seen in Gamble et al.’s (2021) process of evaluating internal environments as well, which concludes with identifying strategic issues and problems that require managerial intervention. This analytical process, as described by Gamble et al. (2021), draws upon both industry and competitive analysis in addition to the evaluation of a business’s internal environment and allows leadership to assess problems or weaknesses that have the highest priority (Gamble et al., 2021). The significance of leadership is also described by Keller, who calls for all Christian leaders to “treat all people and their work with dignity,” “create an environment in which people can flourish and use their God-given gifts to contribute to society,” and “to embody grace, truth, hope, and love in the organizations we create” (Keller, 2012).

Decision Models PESTEL analysis is typically utilized when analyzing an organization’s external environment, however, some aspects can be repurposed to analyze a business’s internal environment. For example, certain economic factors such as interest rates may impact an organization's financial performance, or technological factors such as artificial intelligence advancements may be hindered by existing technological capabilities. SWOT analysis likely remains the best candidate to evaluate an organization’s internal environment, as this model includes factors from both internal and external environments. Described as a “powerful tool for sizing up a company’s internal strengths and competitive deficiencies, its market opportunities, and the external threats to its future well-being,” SWOT analysis provides numerous benefits including increased advantage over competition and opportunities for growth. Conclusion A proper assessment of an organization’s internal environment is pivotal to the business’s long- term success, as it allows them to identify and address potential weaknesses. Using Gamble et al.’s (2021) multiple-step process, organizations can identify areas that require attention, both with existing strategies and position with the market. It then becomes the responsibility of management to resolve any outstanding issues, highlighting the significance strong leadership can have on the success of an organization. Although internal environments have shared impacting factors with external environments, they also possess unique impacting factors that require analysis, through the use of decision-making models such as SWOT analysis. References Ahmed, S. W., & Siddiqui, D. A. (2020). Human resource management, total quality management and competitive advantages: evidence from Pakistani banking industry . SSRN. Gamble, J., Peteraf, M., & Thompson, A. (2021), Essentials of strategic management , McGraw- Hill Course Content Delivery (7th ed.), New York, NY. ISBN: 9781260785791. Kazmi, S. A. Z., & Naaranoja, M. (2015). Cultivating strategic thinking in organizational leaders by designing supportive work environment!. Procedia-Social and Behavioral Sciences , 181 , 43-52. Keller, T. (2014), Every good endeavor: Connecting your work to God's work , Riverhead Books, New York, NY. ISBN: 9781594632822. Rumelt, R. (2011), Good strategy/bad strategy: The difference and why it matters ., Crown Business, New York, NY. ISBN: 9780307886231. School of Business, Liberty University Faizan Malik Week 4 Annotated Bibliography Assignment

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Author Note: Faizan Malik I have no known conflict of interest to disclose. Correspondence concerning this article should be addressed to Faizan Malik: Fmalik@Liberty.edu Ahmed, S. W., & Siddiqui, D. A. (2020). Human resource management, total quality management, and competitive advantages: evidence from the Pakistani banking industry . SSRN. In this study, researchers aim to understand the relationship between human resource management, total quality management, and competitive advantage concerning the banking industry of Pakistan. The study found that both have competitive advantages in the banking industry, with human resource management tools such as training and development being significant predictors of competitive advantage, while total quality management areas such as customer focus have a similarly positive influence. Researchers describe the relationship between human resource management and total quality management as complementary, as both act to create competitive advantages such as improved employee performance. The publication was included in the Journal of Organizational Change Management, which is peer reviewed and includes high-quality research. The study was structured well, with a detailed review of techniques used to analyze data. The study is, however, limited due to a small. The localized data set includes self-reported data which may carry certain biases. Both researchers appear to be well-versed and knowledgeable in the subject and provided a study that was easy to follow and explained the results well. Overall, this was a high-quality publication. The study fits into the discussion somewhat indirectly, as it enforces the significance of competitive advantage which is a major impact factor for internal environments. It also highlights human resources and total quality management as crucial elements to understanding competitive advantage and, subsequently, evaluating internal environments. Additionally, the study highlights the significance of aligning human resource management and total quality management, as this is also required for evaluating an internal environment by providing additional insights into a competitive advantage. Kazmi, S. A. Z., & Naaranoja, M. (2015). Cultivating strategic thinking in organizational leaders by designing a supportive work environment! Procedia-Social and Behavioral Sciences , 181 , 43-52.

This study sought to understand how organizational leadership can cultivate a strategic mindset amongst employees by developing a supportive work environment. The researchers found that such supportive work environments led to the benefits of improved communication and collaboration, and employee empowerment. Leaders, in this study, played a significant role in this process by establishing clear direction, opportunities for growth, and a positive work culture. The study also explained the benefits of including all employee levels in organizational planning, as it provides a sense of ownership and promoted strategic thinking amongst employees. Finally, the researchers demonstrated the significance of aligning organizational mission, vision, and values with strategic goals, as this would motivate staff by providing the sense that their work is impacting the business. The journal is peer-reviewed and includes multiple reputable sources, although it should be noted the articles are shorter than one would expect. The quality of the publication, however, is unclear as it provides no clear understanding of the sources of data. The methodology is well explained but carries multiple limitations such as a lack of depth when explaining the benefits of supportive work culture. The authors are well-versed and known within the area of study. The study is well-written and provides a clear explanation of the benefits of a supportive work culture. The study fits into the discussion as it highlights the importance of strong leadership and the impact it can have on internal environments. Organizational leadership is often responsible for developing culture, which is directly correlated to the work environment. When leadership promotes growth for employees and emphasizes competitive advantage for the business, the organization is often met with sustained success. Isabelle, D., Horak, K., McKinnon, S., & Palumbo, C. (2020). Is Porter's Five Forces Framework Still Relevant? A study of the capital/labour intensity continuum via mining and IT industries. Technology Innovation Management Review , 10 (6). In this study, researchers sought to understand the significance of Porter’s five forces in today’s business environment. The study, which focused on the IT and mining industries, found that Porter’s frameworks still carry relevance across varying industries, but are more suitable in areas with greater capital intensity when compared to labor intensity. The researchers also highlight the significance of the degree of commoditization within an industry and the subsequent utilization of Porter’s five forces, where in such industries degrees of advantage are often more dependent on cost reductions and efficiency. The researchers also recommend organizations use Porter’s five forces as a framework or starting point for their strategic analysis but tailor it to meet their specific needs. The publication appears well-researched and well-organized, offering clear research questions and the use of existing literature. The study itself is filled with data, but given it was only conducted in two industries, the results carry some limitations However, this is acknowledged by the researchers, who include expansion of the study into additional

industries in their suggestions for future research. The authors are highly qualified and accredited within their respective fields. The study was peer-reviewed and easy to follow. Overall, this was a high-quality publication with notable researchers. The study fits into the current discussion, as it highlights how Porter’s five forces remain relevant today across varying industries. Adaption of the tool, along with customizing it to meet business-specific needs as suggested by the researchers, continues to offer organization use insights into external factors that can impact their business. Wood, B., Williams, O., Nagarajan, V., & Sacks, G. (2021). Market strategies used by processed food manufacturers to increase and consolidate their power: a systematic review and document analysis. Globalization and health , 17 (1), 1-23. In this study, researchers sought to understand market strategies employed by processed food manufacturers and their impact on public health. The study, which was conducted with processed food manufacturers, found that these organizations implement a variety of strategies to both increase and consolidate market power, which includes consolidation and mergers, vertical integration, diversification, and brand management. Researchers then highlight the negative impact of such strategies which include reduced competition, increased market power, and decreased consumer choice, which collectively lead to issues for the consumer in terms of quality and price. Researchers also found that such strategies often have a detrimental impact on public health, an issue that is compounded by regulatory environments which often favor the manufacturers over consumers. The researchers also suggested that greater transparency is needed within the processed food industry, including for policymakers, and suggest research into the effectiveness of such strategies. The publication was very systematic, reviewing existing literature and providing insight into current policies that govern processed food manufacturers. The researchers offer limitations in their study, specifically that industry-funded research included in their study and publications may have a bias towards the interests of the industry. The authors are well-versed in the topic and offer conclusions based on evidence. Overall, this was a high-quality publication. The study fits into the current discussion as it provides insight into a specific industry’s tactics to gain market power, including political, economic, and social factors – all of which could be included in a PESTEL analysis. The study also highlights how processed food manufacturers gain market power through consolidation and mergers, vertical integration, diversification, and brand management, all of which can be impacted by a organization’s external environment.

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Faizan Malik School of Business, Liberty University Week 3 Student Reply Author Note Faizan Malik I have no known conflict of interest to disclose. Correspondence concerning this article should be addressed to Faizan Malik. Email: Fmalik@Liberty.edu Hey Malte, great post! You explained the significance of external business environments in formulating business strategies, presenting them as either an obstacle or an opportunity. You highlighted the steps in analyzing one’s external environment beginning with a comprehensive assessment and the ability to be adaptable to any change. In your discussion, various sources of power were explained including the need to be creative and the need to establish an internal framework to monitor external environments continuously. As stated by Ivančić et al. (2017), “executing a strategy, no matter how brilliant it is, requires a planned approach and constant environment monitoring” (Ivančić et al., 2017). SWOT and PESTEL are two great decision models to assess environmental factors, as SWOT identifies and analyzes potential weaknesses and threats while PESTEL covers the most common components of macro-environments. Your conclusion sums up the overarching takeaways from this week’s assignments, in that although tools such as PESTEL and frameworks such as Porter’s five forces are useful, organizations must tailor these tools to meet their specific business needs. I agreed with your statement of “organizations and their staff should embrace flexibility and change to avoid being surprised by changes in the external environment, including customer priorities, changes in legislation, and new technologies.” Countless businesses have fallen into obsoletion simply because they have failed to anticipate changes in their external environment. Blockbuster is a prime example, as they failed to anticipate changes in technology and consumer trends, which ultimately led them to decide against purchasing Netflix and subsequently went out of business. Griffiths et al. (2019) highlight several explanations for Blockbuster’s failure, citing the emergence of streaming services behind the organization’s downfall (Griffiths et al., 2019). Blockbuster’s lack of creativity and adaptability, as you mentioned in your discussion, also contributed to its eventual failure. References

Griffiths, M., Fenton, A., & Fletcher, G. (2019). Horizon scanning: Cautionary tales. In Strategic Digital Transformation (pp. 65-72). Routledge. Ivančić, V., Mencer, I., Jelenc, L., & Dulčić, Ž. (2017). Strategy implementation–external environment alignment. Management: journal of contemporary management issues , 22 (Special Issue), 51-67.

BUSI770DB3

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