Environmental scanning is the process through which an organization gathers, analyzes, and interprets information from the internal and external environment to identify potential opportunities and threats that could impact its strategic decisions.
Thank you for reading this post, don't forget to subscribe!- The purpose of environmental scanning is to identify internal and external elements that determines the future of the organization.
1. Types of Environmental Scanning
Environmental scanning may be classified into two types consisting of:
- Concentrated Scanning
- Comprehensive Scanning
▪️ Concentrated Scanning
Concentrated scanning is a focused and targeted approach where the organization pays close attention to one specific area of the environment. It concentrates on a few important factors that directly affect the organization’s decisions.
Features:
- Focuses on specific issues, trends, or factors.
- Saves time, resources, and effort.
- Suitable when the organization has limited resources.
- Used when the business operates in a stable environment.
- Helps managers make quick decisions on targeted issues.
Example:
A mobile phone company focusing only on technological changes such as new processors, AI features, and network updates.
▪️ Comprehensive Scanning
Comprehensive scanning takes a broader and more holistic view of the environment. Instead of focusing on a single issue, it covers all major external factors, often summarized using the PESTLE framework:
- Political
- Economic
- Social
- Technological
- Legal
- Environmental/Ecological
Features:
- Examines political, economic, social, technological, legal, and environmental (PESTLE) factors.
- Provides a complete picture of opportunities and threats.
- Requires more time, resources, and expertise.
- Suitable for organizations operating in a dynamic or uncertain environment.
- Helps in long-term strategic planning.
Example:
A multinational company analyzing political changes, cultural trends, technological innovations, competitors, and legal rules before entering a new market.