chapter  3
39 Pages

Environmental Analysis for Sustainable Strategic Management

ByJean Garner Stead, W. Edward Stead

The sustainable strategic management process begins with identifying opportunities and threats in the external environment and then formulating effective strategies for dealing with them. Scanning and analyzing the firm's external environment is increasingly complex due to the turbulent coevolutionary environmental forces affecting business organizations. The coevolutionary forces in the environment are so dynamic and interrelated that environmental analysis must be based on systems thinking, focusing on developing information flow, feedback loops, analytical processes, dialogue processes, and so forth, that will allow organizations to recognize, understand, and capitalize on the environmental turbulence that surrounds them. Given the uncertainty of an external environment characterized by turbulence, complexity, discontinuity, and change, strategic managers engaged in sustainable strategic management must develop a systems-based environmental scanning culture within their organizations. This means that macro environmental scanning needs to be expanded to include the social and ecological sectors, and that traditional industry analysis needs to move toward a coevolutionary analysis of business ecosystems.