Basic Business Cents

Basic Business Cents

Conditions Affecting Our Business

Understanding Our Current Status

by Lou Schultz, SCORE counselor

Original publish date 12/2009

Before we can develop a good strategic plan, we have to truly understand our present situation. There are conditions, both internal and external to our organizations, which impact our direction and success in achieving our aim. In this article we will provide lists of questions to help you identify and analyze these conditions.

The internal conditions delve into areas such as capabilities, resources, systems, and processes. The internal environment defines the climate of the organization. Among the questions to be answered are:

  1. Are we capable of reaching our vision of what we want to attain?
  2. If not, what are we lacking and what do we have to do to get it?
  3. Do we have the resources to reach our vision?
  4. If not, what are we lacking and what do we have to do to get it?
  5. Do we have the proper systems and processes in place to reach our vision?
  6. What is the organization's financial strength? Is the organization adequately capitalized?
  7. What is the condition of the organization's facilities? Are they in the right locations?
  8. Is the organization adequately staffed? Have the right people been hired?
  9. Is the organization using the right distribution system?
  10. Are employees receiving the right information?
  11. Is quality achieved by leadership or delegation?
  12. What is impossible for you to do now in your efforts to provide service to your customers, that if a fundamental change was made would be possible to do in the future?
  13. If you had unlimited resources available and the freedom to do whatever you wished with the organization, what would you do now? What would you do over the next three to five years?
  14. What are our core competencies? What do we do better than anyone else?
  15. What core competencies do we need to acquire to succeed in the future?

An analysis of the external environment looks at the organization's social, political, technological, and economic issues directly and indirectly affecting the business environment. Some questions to be addressed include:

  1. What are the economic trends, which are likely to have the most impact on your business over the next three to five years?
  2. How will environmental enlightenment affect us?
  3. What demographic, geographic, and social factors will affect the business environment?
  4. What economic, political and governmental factors will affect the business environment?
  5. What regulations (such as the North American Free Trade Agreement) might impact our business?
  6. What government regulations might impact our business?
  7. What effects could the national or local economy have on our business?

Answering questions is easy; knowing what questions to ask is hard. These questions are a start and may trigger your thinking to other key questions that need to be addressed to fully understand the climate in which your organization operates. Once this is done, you are ready to move forward with your planning.

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