chapter  4
28 Pages

The External Environment

Effective strategies make it possible for a company to compete successfully in the

aviation environment, but good strategies do not come without hard work and detailed

planning from the CEO. A well-thought out strategy is the output of a thorough

analysis of the environments affecting the company. Thus, determining the appropriate

strategy should come directly from an assessment of the external environment and

the company’s internal environment. In this chapter, we will discuss the external

environment. The external environment encompasses all of the relevant forces

outside of the company’s control. While one company cannot have a major effect on

these forces, changes in external environmental forces can have a significant effect

on the way the company does business. In other words, a company could be forced

to change its business model or strategic direction based solely on a change in one

of these relevant forces. Furthermore, just as there is a micro and macro analysis in

economics, a company is affected by both macro and micro-environmental forces.