Publisher: Amacom, 2000, 258 pages
The leaders of every business, regardless of its size or area of focus, face the never-ending challenge of reshaping its capabilities to meet the demands of the environment in which it must compete. Understanding the firm’s business environment and interpreting its signals have become more crucial and more difficult than ever before.
Strategic thinkers consider the “environmental scan” a key starting point for the critical decisions that define the success of the business. This is the process of studying the business environment to understand its major dimensions of impact and opportunity for the firm. Conclusions drawn from this study become the driving principles for achieving and maintaining the necessary strategic focus. If the business environment is the battlefield, then the environmental scan is the firm’s “radar screen” for detecting the threats and opportunities it offers.
In today’s business environment, every manager needs a clear understanding of these basic truths, trends, and events that are shaping the choices he or she will have to make, whatever his or her level of responsibility. Many leaders also feel that the employees need and deserve to know what’s happening to the world around the organization to which they are devoting their energies and talents.
Many executive teams and divisional leaders within organizations carry out a formal periodic review and re-examination of the operating environment. Many firms make this an annual process, as a part of a regular executive strategy retreat. Many more should. A careful and thoughtful environmental scan lends a degree of discipline to the process of deciding where to focus the resources of the organization. It also builds a level of consensus that helps the executive team work together, and helps them communicate a sense of common purpose to the rest of the organization.
Corporate Radar is a practical book that can be valuable reading for any manager, at any level, in any type of organization. It guides the reader through a fairly comprehensive thinking process and shows how to distill the results into a compelling story. It is well supplied with stories and case examples of firms that have succeeded or failed to understand their environments.
It highlights specific instances of environmental events or trends that have changed the fortunes of various firms. It also explores a range of provocative ideas relating to the global events and trends business leaders need to be thinking about. The Third Wave concept, pioneered by futurist Alvin Toffler, offers a useful perspective for these ideas. Areas such as information technology and the restructuring of society also offer compelling considerations about future impacts and opportunities.
The “backbone” structure of the book is the Karl Albrecht model of the business environment, which is a simple wheel diagram depicting eight sub-environments, or dimensions of impact and opportunity: Customer, Competitor, Economic, Technological, Social, Political, Legal, and Geophysical.
The Customer Environment, for example, is the dimension of basic truths, trends, and events that are shaping customer attitudes, values, wants, needs, and buying habits for your particular line of business. The “customer radar” is the thinking process that leads to a clear understanding of the customers you want to do business with.
Similarly, the Technological Environment is the dimension that shapes your choices in such areas as the design of products and services, the infrastructure of your business, strategic relationships with business partners and customers, and the delivery of your customer value package.
The Geophysical Environment deals with the practical geographic, ecological, and structural aspects of the business, such as the availability of natural resources, ecological considerations of your product or service, proximity to a highly qualified workforce, and many other factors which are often neglected in strategic planning.
The model also applies well to non-corporate enterprises, such as government organizations, educational institutions, associations, and others that need a strategic approach to their survival and success.
The objective of the treatment is to allow any manager, whether he or she is the chief executive or an operational leader, to talk intelligently about the business environment of his or her particular enterprise. The eight-dimensional model, plus the various stories and global themes, will support ongoing discussions and creative thinking about the future of the business.
If you really want to learn how to interpret the environment and make sense out of it, you have found the best resource on the market for it!
Personally, I usually find that the business environment scanning books give too shallow advice and doesn't really explain how to do it. This book is the exception to that, as he explains how and why to do stuff, while at the same time keeping a coherent logic thru the whole book.
Deeply recommended for any manager that perceives that there exists an environment out there, that s/he need to at least understand a bit about.