External Analysis
This process involves scanning and evaluating the environment to identify opportunities or threats.
What is external analysis?
This KPI measures the amount of money earned before expenses
What is revenue?
This is considered the critical linkage variable in the Diamond-E
What is strategy?
This KSF involves generating income to keep the business sustainable
What is achieving financial performance?
According to Porter, this force describes consumers and organizations that purchase goods and services.
What are buyers?
These three main challenges make external analysis difficult: rapid change, time consumption, and imperfect forecasts.
What are the challenges of external analysis?
This KPI is calculated as net profit divided by total investment.
What is return on investment (ROI)?
The goals is to have all factors above aligned with one another– consistency between variables– external/internal environment must be aligned
What is the Principle of logic?
This KSF emphasizes reliability, quality, and timeliness to ensure continued sales
What is meeting customer needs?
When there are only a few of these, they have more power over companies
What are suppliers?
The two main tools used to conduct external analysis.
What are PEST analysis and Porter’s Five Forces?
This KPI measures the likelihood of customers recommending a product
What is Net Promoter Score (NPS)?
This component reflects managers’ biases and approaches
What are management preferences?
This KSF encourages creativity through training programs and open forums.
What is innovation?
Laser eye surgery competing with glasses is an example of this force
What are substitutes?
This type of environment analysis looks broadly at political, economic, social, and technological factors.
What is PEST?
High levels of this employee KPI may suggest poor hiring practices or low satisfaction
What is turnover?
Marketing, operations, finance, and human resources make up
What is the Internal environment?
This KSF relies on incentive plans and employee participation in decision-making
What is gaining employee commitment?
Walmart pressuring suppliers is an example of high power for this force
What are buyers?
This type of environment analysis focuses on suppliers, buyers, competitors, entrants, and substitutes.
What is Porter's Fiver Forces?
Helps understand the ratio of profit to every dollar of sales
What is Profit Margin?
This company failed to adapt to digital cameras, losing market share to Canon
What is Kodak?
This KSF relies on incentive plans and employee participation in decision-making
What is creating a distinct competitive advantage?
This force intensifies as industries mature and growth slows
What is rivalry among competitors?