ENVIRONMENTAL SCAN

Environmental Scan

Abstract

The increasingly dynamic and turbulent environment calls for new perspectives of competitiveness. Most previous studies suggest building competitive advantage using the micro perspective through customer and competitor orientation. This paper purposes to employ the holistic perspective through multiple value creations to gain sustainable outcomes. Collier calls these interactions “moments of truth” in which the company must create and establish the milieu of ultimate customer care. Each and every staff member needs to see the successful creation of truth moments as his/her personal goal in order to achieve success. Because of this complexity, competitive advantage is an elusive concept that much needs to be grasped and implemented in order to ensure survival in the ever changing environment.

Environmental Scan

Introduction

Environmental scanning is the first phase in strategic management. This is where monitoring, evaluation, and dissemination of information from external and internal environments to key people within the corporation such as stakeholders exist. A company may look at internal environments such as opportunities and strengths as well as external environments such as threats and weaknesses. Often time's economic, technological and political forces are also examined during an environmental scan. Organizations use environmental scans to establish competitive advantages and thus determine how to align their competitive advantages with the organization's strategic plans.

How to Create Value and Sustain Competitive Advantage

Every organization operates in both internal and external environments. While the environment has a profound impact on the organization, the organization has little impact on the environment. The best any organization can do is to continuously scan the environment for opportunities, threats, weaknesses, and strengths. An organization's strengths are often used to create value and sustain competitive advantages. Competitiveness or competitive advantages referred to the ability to do things better than competitors is the heart of business success (Porter 1980). In particular, delivering certain customer value better than the others results in superior performance as Nike's premium quality athletic shoes using overseas cheap labor has produced an amazing rate of 46.9 per cent in its average annual return to the shareholders in the decade between 1986 and 1996 (Wheelen, 2008).

Creating such unique competitive advantages is not sufficient for sustainable development. According to the new economy, there are a growing number of consumers looking for more than quality products at a low price. In addition, they increasingly desire innovative products that express their unique, personal identity and prefer convenience, good services, as well as engaging experiences in all aspects of their lives (Wheelen, 2008).

Companies Creating Value and Sustained Competition

Coca Cola creates value for its clients over its competitors by offering a product that the customer values in a special way. Coca Cola offers a product at lower cost as being the market leader, and this strategy makes it differ from its competitors. Coca Cola competition position depends on obtaining a sustainable competitive advantage and defending the superiority. If this does not occur, the customer will create value, which will be able to exploit the rivalry among competitors like Pepsi to get low prices (Koenigs, ...