Strategic Marketing: Planning and Control, Third Edition

22 Strategic Marketing: Planning and Control

An analysis of the external environment can be broken down into three

key steps each becoming more specific to the organisation. The first step is

an analysis of the macro-environmental influences that the organisation

faces. This is followed by an examination of the competitive (micro) envir-

onment the organisation operates within. Finally a specific competitive

analysis is undertaken.

■ Scanning

The environmental audit is reliant on the monitoring activity that is

undertaken by the organisation. The process is normally referred to as

Scanning

There are four forms of scanning according to Aguilar (1967). They are

as follows:

1 Undirected viewing: This activity concerns the viewer exploring infor-

mation in general without carrying a specific agenda. The viewer is

exposed to a large amount of varied information but this is not an

active search looking for particular issues, just a broad attempt to be

aware of factors or areas that may have changed.

2 Conditional viewing: Again this is not an organised search but the viewer

is sensitive to information that identifies changes in specific areas of

activity.

3 Informal search: This is an organised but limited search for information

to support a specific goal.

4 Formal search: This type of search is actively pursued and specifically

designed to seek particular information.

There is of course an unlimited amount of information that can be scanned.

Any organisation can only scan a certain amount of this information. A bal-

ance has to be struck between the resources allocated to this activity and

the potential benefits. More information also does not lead to better deci-

sion making. Understanding the dynamics of the environment is the criti-

cal aspect to this activity, not the volume of information reviewed (see the

section on Market sensing in Chapter 6).

Managers search for information in five broad areas (Aguilar, 1967) (see

Figure 2.2):

1 Market intelligence

2 Technical intelligence

3 Acquisition intelligence

4 Broad issues

5 Other intelligence

Note: Aguilar uses the word tidings rather than intelligence.

The study showed that 58 per cent of managers saw market intelligence as

the most important area for obtaining external information, three times

more important than the next most significant area, technical intelligence