Observing, Analysing And Evaluating An External Environment Essay

The purpose of this essay is to detect, analyse and measure ACBT ‘s external environment and place the strategic strengths and failings of ACBT to win or neglect in the environment. This essay will dwell of a important rating of the strategic direction procedures, where different positions for sing ACBT will be exposed. Important points of ACBT such as the strategic strengths and failings and how these elements adopt the dynamic external environment in order to win of fail. Hence, in order for this debut to give a better understanding about strategic direction, its theories and the organisation being observed must be mentioned about. Furthermore, due to the word bound most of the information required for the statements and treatment are to be found in appendices in an exemplifying mode.

In order for ACBT to win, ACBT needs to accomplish a sustainable competitory advantage which can non be imitated by its rivals. Determining how to develop a sustainable competitory advantage will be shown in this essay in footings of the strategic planning procedure.

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First, ACBT ‘s concern scheme will be identified along with its mission and vision. Then the external environment will be analysed. This analysis will demo the macro environment and industry environment in which the administration operates. The internal environment will so be analysed to place ACBT ‘s capablenesss in order to win or neglect. Besides, all other relevant theories will be discussed in the latter portion of the essay.

2.0 What is strategic direction?

Strategic direction consists of the determinations and actions used to explicate and implement schemes that will supply a competitively superior tantrum between the organisation and it ‘s environment, to enable it to accomplish organisational aims ( Hannagan, 2002, p 3 ) .

Scheme is the way and range of an administration over the long-run: which achieves advantage for the administration through its constellation of resources within a ambitious environment, to run into the demands of markets and to carry through stakeholder outlooks ( Johnson, Scholes & A ; Whittington, 2005 ) .

This definition shows that in order to explicate a scheme, both the internal ( strengths and failings ) and external ( chances and menaces ) environment demand to be taken into consideration. Besides, stakeholder outlooks need to be considered when explicating a scheme.

Therefore to be booming, organisations must suitably acknowledge that strategic direction is an bing and germinating procedure that does non stop with the strategic program. It is a procedure which requires uninterrupted rating and betterment to last in the quickly changing universe today, in order to derive a competitory advantage over fellow rivals

3.0 Characteristics and the intent of the strategic direction

It helps an administration take a proactive attack instead than a reactive attack ( David, 2003 ) .

Provides a agency to cover with rapid alteration inside and outside the administration.

As the external environment is unpredictable, strategic direction enables the appraisal of the external environment so that action can be taken to react to it

Features of strategic direction determinations are given in Appendix 1.

4.0 The strategic direction procedure

The procedure of strategic direction consists of strategic analysis, strategic way, strategic pick, strategic execution and strategic rating and control ( Viljoen & A ; Dann, 2000 ) .

The procedure of strategic direction includes four interrelated procedures which consist of scheme analysis, strategic way, scheme pick, and scheme execution ( appendix 2 & A ; 3 ) . Strategic direction has been conventionally thought of as chiefly a proficient and rational procedure. This has been the chief attack in educating about scheme and how the scheme procedure emphasizes on the affair of how to analyse, take and implement schemes. Therefore in every phase of the rational procedure it can either enhance or acquire in the manner of the result.

In the strategic direction procedure, it is ever critical that the apprehension of the organisation and the execution of the right scheme occurs. Assorted organisations use assorted schemes in order to accomplish organisational success by accomplishing organisational ends and aims. Normally the formation of a scheme rallies around the resources and capablenesss of an organisation and besides the market in which the organisation operates. An organisation can utilize schemes to determine its environment so that the house can derive an advantage on the tendency of the environment.

4.1 Strategy analysis

“ Strategic analysis requires directors to acknowledge all the major forces at drama in their industry and to make up one’s mind whether these represent chances or menaces to the organisation. These include environmental forces and the accomplishments and resources of the organisation. ” ( Quinn, Mintzberg and James, 1998 )

An internal and external environment analysis has to be conducted in order to deeply or exhaustively understand as to where the organisation stands in the market presently. External analysis can once once more be divided into macro environmental factor analysis and industrial analysis. By and large a macro environmental analysis is done in order to acquire a deeper position of the environment in which the house operates. The analysis conducted in order to detect the macro environmental factors is called the PEST analysis. This is,

P- Political

E- Economic

S- Socio-cultural

T- Technological

Plague Analysis ( External Environment )


Environmental protection Torahs, revenue enhancement Torahs, right of first publication Torahs, foreign trade ordinance, stableness of authorities, attitude towards foreign companies are evaluated under the political-legal analysis.


Changes in Sri Lankan population, involvement rates, revenue enhancement Torahs, rising prices, foreign trade jurisprudence, and steadiness of the authorities in Sri Lanka are besides important countries that ACBT needs to be cognizant of ; as it has put in an sum of money and hence demands to guarantee that they get moneymaking returns out of the investing made.


Growth rate of population, age distribution of population, regional displacements in population, lifestyle alterations, birth rate, life anticipation, social attitudes, cultural distribution are considered under the socio-cultural analysis.


The technological point of position is one more country that ACBT needs to be attentive of in order generate a infinite between the present twenty-four hours technological systems and methods used in Sri Lanka to supply instruction and the more modern and improved systems and methods ACBT can supply in order to derive a competitory advantage. ( Appendix 4 & A ; 5 )

Industry environment analysis

Porter ‘s five forces theoretical account will enable ACBT to measure how profitableness will be affected by the menace of new entrants, providers, purchasers, replacements and challengers. ( Hubbard, Rice & A ; Beamish, 2008 ) . ( Appendix 6 )

Menace of new entrants

-Time & A ; cost of entry

-Specialist cognition

-Economies of graduated table

-Cost advantages

Dickering power of clients

-Number of purchasers

-Size of order

-Price sensitiveness

Menace of replacements

-Substitute public presentation

-Cost of alteration

Dickering power of providers

-Number of purchasers

-Size of order

-Price sensitiveness

Rivalry among bing rivals

-Number of purchasers

-Size of order

-Price sensitiveness

Value concatenation analysis

Michael Porter ‘s value concatenation analysis should be exploited to calculate as to what processes in an organisation creates value. The usage of the value concatenation analysis helps an organisation decide on what they are good and what they need to do developments on. It helps to organize proper schemes to do usage of their strengths and cut down their failings. ( Appendix 7 )

4.2 Strategy way

In this phase of the procedure, each major chance and menace is taken into history, and from them strategic aims are derived and established in visible radiation of the organisation ‘s mission ( Viljoen and Dann, 2003, p.38 ) .

In the strategic way phase, with regard to the chances and menaces, strategic aims are established including organisational mission, vision, ends and aims. To successful in the concern, these aims should hold to concentrate on the countries of public presentation the organisation will necessitate to make good in order to accomplish its aims. ( KRAs )

With respects to ACBT, their mission, vision and values refer ( Appendix 8 & A ; 9 )

4.3 Strategy Choice

Viljoen and Dann ( 2003 ) province, that scheme pick physiques on the stages of scheme analysis and way scene and involves the coevals, rating and pick of the scheme that best suites the demands of the organisation.

Evaluation involves evaluation each harmonizing to its ability to work the environmental chances. And besides it requires an appraisal of the strengths and failings of the company in footings of its ability to manage those issues efficaciously.

Harmonizing to the ACBT ‘s prospective, they have clearly identified the chance for demand of instruction in Sri Lanka every bit good as Maldives and they are providing towards that need by utilizing their internal accomplishments and capablenesss.

One good strategic pick that ACBT has recognized is the trimester or 3 semester fast path system. Where, pupils can go degree holders in 2 old ages, by taking 4 topics per semester. Not a individual of the major rivals of ACBT has this type of a scheme and ACBT and as a consequence ACBT has achieved a considerable competitory advantage as an consequence of this.

4.4 Strategy Implementation

Considered as the concluding phase of the strategic direction procedure, it is an of import measure of the strategic direction procedure, as the success of it and the effectivity depends on the execution. Strategy execution ; “ concerns the operational schemes and systems that must be used to set the scheme into pattern ” ( Viljoen and Dann, 2003, p.38 ) . It concerns the operational schemes and systems that must be used to set the scheme in to pattern. It involves the capital budgeting to apportion resources to new undertakings and to the creative activity of new operating and administrative systems.

Considering of ACBT, to accomplish their overall mission and vision they have implemented and maintain of a quality control plan underpinned by the benchmark forms of both ECU and the Australian Qualifications Training Framework and besides with respects to selling and the promotional budget of ACBT, it has increased last few months in order to advance ACBT among its mark market.

The ability of directors to carry on strategic direction procedure right will find the long term success of the organisation. The failure to execute those maps will free the competitory advantage and strength in their several industries.

5.0 Strengths and Failings of ACBT

Strength is an organisational capableness based on resources and competences of an organisation which will supply a strategic competitory advantage to accomplish organisational ends and aims.

The good will that ACBT has built up in the past 10 old ages goes on to function them all right, and will make so excessively in the close hereafter. ACBT came to the spotlight merely as the demand for foreign instruction was booming. ACBT gave pupils the chance of a foreign instruction at 1/4 of the cost at the same clip as non holding to remain off from household and friends. This has been a sustainable competitory advantage ( SCA ) for ACBT.

It is of import to observe that ACBT ‘s clients are non the consumers for the undergrad plan. Parents who want their kids to have a foreign instruction see ACBT as an alternate due to the cost benefit, the fast path option, and besides the fact that Australia is considered by many as one of the best instruction finishs in footings of quality of instruction, 2nd merely to the UK, in the universe.

Diversifying into other facets of instruction such as IELTS and MBA, with chance for a doctorate plan to be initiated really shortly, ACBT has slightly spread its random hazard. It can be argued that its lone instruction on offer but the mark markets are to some extent unique and big plenty for them to be sustainable in the long tally. ( Appendix 10 )

Weakness is defined as incapableness due to non handiness or deficiency of resources and competences in an organisation that will impede or blockade accomplishing a strategic advantage to accomplish organisations ends and aims.

The biggest concern for most pupils and possible pupils is the frequence and size of fee increases. Over the past 2 old ages fees have been revised on a semiannual footing by big sums. This non merely detracts possible clients but besides bing clients every bit good.

Furthermore, the deficiency of class picks is another concern. ACBT entirely offers Degrees in concern and computer science, where as rivals have diversified into legion of classs such as psychological science, advertisement, finance, chemical scientific discipline, astronauticss etc. this is a terrible disadvantage as there is a solid demand for such classs among the current cohort who wish to spread out their skylines and non jus stick to the usual.

The deficiency of installations in relation to extra and co curricular activities at ACBT adds to the above job as consumers and clients demand for more value for money. Relatively their rivals offer excess and co-curricular activities. ( Appendix 10 )

6.0 Opportunities and Threats of ACBT in relation to its strengths and failings

Opportunity is defined as a positive tendency in the organisations external environment that will be an advantage to the organisation in accomplishing its ends and aims.

Menace is defined as a negative tendency in the organisational external environment that will blockade or harm accomplishment of the ends and aims of the organisations by non leting it to accomplish an advantage. ( Appendix 10 )

ACBT will hold to utilize their strengths to capitalize on the chances available in the dynamic external environment. Besides, the failings can be reduced whereas the menaces can be avoided on being identified.In relation to find the strategic options available to ACBT, the strengths and failings from the internal environment together with the chances and menaces from the external environment demand to be analysed.

ACBT can take advantage of their strength of holding an established trade name name to offer grades in other countries such as accounting, psychological science and assorted other classs. Correspondingly, ACBT should seek to avoid failings such as melting to place pupil ‘s jobs in a methodical mode because of the menace of high pupil turnover due to ever-increasing unit fees. In order to construct up a strategic capableness, ACBT can work the chance of pupils by presenting the on-line library service, besides presenting more diversion installations, athleticss, garnering etc. This scheme will besides reenforce the mission and vision of ACBT to supplying an ambiance which is supportive and good resourced enabling pupils to maximise their full instruction potency.

7.0 Major rivals of ACBT

American National College ( ANC )

Asia Pacific Institute of Information Technology ( APIIT )

American College of Higher Education ( ACHE )

International College of Business and Technology ( ICBT ) ( Appendix 11 )

8.0 Decision

From the above information it could be said that ACBT should see its strengths and failings against the dynamic external environment in which it operates. Since rivals of ACBT such as ANC, ICBT, APIIT etc supplying high superior service with good recognized instruction system ACBT should convey new inventions in order to derive a competitory advantage. In order to ACBT to win ACBT should make a PEST analysis along with the rival analysis as a portion of scanning the external environment. Internal analysis should besides be considered and ACBT should minimise their failings and should seek to increase their strengths and at the same clip activities that can add value to its merchandises should be identified by the value concatenation analysis.

ACBT can derive a competitory advantage by utilizing Michael Porter ‘s 2 major generic schemes, which is lower cost and distinction. ACBT should non bury the on-going universe crisis as people are non willing to pass money. So ACBT should take down their cost than the rivals and should add value to its installations such as athleticss and diversion and besides better library installations.

Looking at the present state of affairs ACBT should set or develop new schemes in order to win.


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