ETOP(environmental threat and opportunity profile).ppt

ETOP

1. 6/17/2024 DR. ASHUTOSH KUMAR 1
Environmental Appraisal

2. 6/17/2024 DR. ASHUTOSH KUMAR 2
Inordertounderstandwhatopportunitiesandthreats
arefacedbytheorganizationatagiventime,itis
essentialtoappraisetheenvironment.
Thisisdonebybeingawareofthefactorsthataffect
environmentalappraisal,identifyingtheenvironmental
factorsandstructuringtheresultsofenvironmental
appraisal.
Appraising the Environment

3. 3
Factors affecting environmental
appraisal
•Strategist-related factors : Characteristics such as age, education,
experience, motivation level, cognitive style, ability to withstand time
pressures and strain of responsibility.
•Organisation-related factors : Characteristics of organisation like
nature of business the organisation is in, its age, size and complexity,
nature of markets and product & services deals in.
•Environment-related factors : Nature of the environment depends
on its complexity, volatility or turbulence, hostility and diversity.

4. 4
Identifying high priority environmental
issues
•Environmental scanning results in a mass of information
related to different sectors of the environment.
•Without a technique to deal with this information, a
strategist would be at a loss to comprehend and analyse
the environmental influences.
•These influences are the events, trends, issuesand
expectationsof different interested group.
•Trendsare the general tendencies or the courses of
action along which eventstake place. Issuesare the
current concerns that arise in response to events and
trends. Expectationsare the demands made by
interested groups in the light of their concern for issues.

5. 5
Identifying high priority environmental
issues
Impact on Business
__________________________________________________________
Probability High Medium Low
of impact
----------------------------------------------------------------------------------
High Critical High priority Low priority
Medium High priority High priority Low priority
Low To be watched Low priority Low priority
---------------------------------------------------------------
Source: Adapted from the William R.Boulton: Business Policy: The Art of Strategic Management(New
York: Macmillan Publishing Co., 1984) p.120.

6. 6
Structuring Environmental Appraisal
•The identification of environmental influences is helpful in
structuring environmental appraisal so that the strategists
have a good idea of where the environmental opportunities
and threats lie.
•One of the important techniques to structure the
environmental appraisal suggested by Glueck is
Environmental threat and Opportunity Profile (ETOP) for an
organisation.
•ETOP involves dividing the environment into different sectors
and then analysing the impact of each sector on the
ogranisation.

7. 7
Environmental threats and opportunities profile
(ETOP)
Environmental Nature of impact Impact of each sector
Sectors
Economic
International
Market
Political
Regulatory
Socio-cultural
Supplier
Technological

8. 6/17/2024 DR. ASHUTOSH KUMAR 8

9. 9
Structuring Environmental Appraisal
•Therefore, ETOP provides a clear picture to the strategists of
which sectors have a favourable impact on the organisation.
•It helps the organisation to know where it stands with respect
to its environment.
•It also helps organisation in formulating appropriate strategies
to take advantage of the opportunities and counter the threats
in its environment.
•But, before formulating the strategies, strategists must assess
whether the organisation has the required strengths, or it has
weakness which can affect its capability to take advantage of
the opportunities.
•SWOT analysis is in picture know.

10. Thank you!
•Questions?