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Strategic Management - Environmental Analysis and Diagnosis

Natural Environment - Environmental Analysis

   Posted On :  26.06.2018 12:20 am

Geographical and ecological factors, such as natural resources endowments, weather and climatic conditions, topographical factors, location aspects in the global context, port facilities etc.,

Natural Environment
 
Geographical and ecological factors, such as natural resources endowments, weather and climatic conditions, topographical factors, location aspects in the global context, port facilities etc., are all relevant to business. Differences in geographical conditions between markets may sometimes call for changes in the marketing mix. Geographical and ecological factors also influence the location of certain industries.
 

Natural Resource Availability

 
For example, industries with high material index tend to be located near the raw material sources. Climate and weather conditions affect the location certain industries like the cotton textile industry in Mumbai, Ahmedabad and Coimbatore. Topographical factors They may affect the demand pattern.
 
For example, in hilly areas with a difficult terrain, jeeps may be in greater demand than cars.
 
Ports - Air ports and seaports offer an advantage in transport. Many commercial cities are those, which have this port advantage.

In India business has flourished near ports. For example, Visakhapatnam in Andhra Pradesh, which has a natural harbour, has many major industries like BHPV, steel plant, Hindustan Shipyard, Coromandel Fertilizers etc., located there due to the advantage of port.
 
Green concerns Government is becoming increasingly concerned about protecting the environment. Use of plastic bags is banned in several states and Union Territories like Andhra Pradesh and Sikkim. Government is investing on water harvesting schemes to conserve ground and natural water resources Cliamtic conditions Variations in climatic conditions cause differences in demand for goods.
 
More number of air conditioners and refrigerators are sold in the South India during summer due to warm weather. Impact of macro environment on business The trends in mega environment, from the viewpoint of a company, have long-term implications. Figure 4-2 shows some of the trends that impacted business.



(Source: Alex Miller and Geogory G. Dess( 1996), Strategic Management McGraw -Hill, New York, p. 61.)
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