6 External Business Environment Free Online FlashCards

What is the external business environment?

The forces, trends, and stakeholders outside an organization that can affect its objectives, operations, people, and performance.

What six categories does PESTLE use to scan external influences?

Political, Economic, Social, Technological, Legal, and Environmental.

What is an important limitation of PESTLE?

PESTLE structures broad scanning, but it does not determine what an organization should do. Its findings must be connected to organizational objectives and choices.

Which stakeholders can shape an organization's strategic options?

Competitors, customers, suppliers, regulators, lenders, and communities can influence an organization's strategic options and expectations.

What is the sequence for turning external signals into decisions?

Scan, interpret, assess implications, choose a response, assign accountability, and review.

What should leaders consider when interpreting an external development?

Judge how likely it is, how quickly it may occur, and which organizational objectives it could affect.

How should the depth of external analysis be determined?

Analysis should match the potential impact: a potentially serious development deserves deeper investigation than a low-impact signal.

When does an external development become a risk?

An external development becomes relevant as a risk when uncertainty could affect an objective, negatively or positively.

What does risk management connect to external conditions?

It connects external conditions to decisions about objectives, resources, and controls.

Which activities are included in the ISO 31000 risk approach?

ISO 31000 describes identifying, analyzing, evaluating, treating, monitoring, and communicating risk, adapted to the organization's context.

How does governance support oversight of external risks?

Governance clarifies who monitors key developments, who can approve responses, and what level of risk the organization is prepared to accept.

What does managing compliance involve, and what can PESTLE not replace?

Identify applicable laws and regulations, understand their effects, assign responsibility, and maintain suitable processes and records. PESTLE does not replace qualified legal or compliance advice.