Strategic Planning in the Small Business

Unit 2

HO

2-6 (continued)

The

las'. two

chapters detailed

the process

of external,

en­

vironmental

analysis

and internal,

firm

analysis. These

chapters

discussed

the importance

and relevance

of

careful analysis

ef­

forts. Specifically,

environmental

analysis

enabled the

small

business

owner to pinpoint

key opportunities

and threats.

Like­

wise,

internal analysis

allows

the business

to assess

its own ca­

pacity

for responding

to these

factors. This

chapter

progresses

through the

strategic

planning process

by considering

the

final

step in the

analysis phase

of our model-recognizing

distinctive

competencies

and

competitive

weaknesses.

ENVIRONMENTAL

OPPORTUNITIES

VERSUS

RELEVANT

BUSINESS

OPPORTUNITIES

As

a business

owner or manager

analyzes

the relevant

external

environment,

a number

of possible

areas of

opportunity

will

likely be revealed.

Perhaps

larger

competitors

have grown

to the

point

where they

no longer

provide the

personal touch

that con­

sumers have

come to

desire and

expect. Perhaps

new segments

or niches

in the

market are appearing

but,

as yet, have

not been

fully

addressed.

Perhaps

consumer

needs and

preferences

arc

shifting

so that adding

additional,

complementary

products

or

services

will lead

to significant

increases

in sales

and profits.

Of course,

merely identifying

opportunities

does not in­

dicate

hat the firm

is either

willing or

able to react

to these

opportunities.

This

determination

is made

after carefully

con­

sidering

the internal

analysis. For

example,

changing

demo­

graphic and

solial factors

witbin a given

community

may indicate

that a restat.rant

and

dinnc. theater

combination

is an attractive

opportunity.

Suppose

no dinner

theater

exists in

the commu­

nity and

the increasing

population

base

of young, upscale

con­

sumers

seems

likely to support

such

an operation.

A particular

Part One

The Analysis

Phase

230

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