Analyzing the impact of these forces on a company can help identify potential risks and opportunities.

One approach to gain a competitive advantage is through effective supply chain management.

Attractive environments have rapid industry growth, limited competitors, distinctive products, a small number of potential entrants, barriers to entry, few replacements, a large number of suppliers, and a large number of customers.

are open systems that are affected by, their external environments

receive financial, human, material,
and information resources from the environment;

transform those resources into finished goods and
services

then send those outputs back into the
environment to meet market needs.

is the economic, legal and political, technological, demographic, social, and natural
environment forces that influence strategic decisions

the amount of
control a firm can exert on external forces

Macroenvironmental forces such as the economy
and social trends are much less controllable

forces in the competitive environment such as suppliers and customers

Changing the competitive landscape through domain selection, diversification, and mergers is an example of strategic maneuvering.

Cooperative strategies, such as contracting, cooptation, and coalition building

better able to handle environmental change by decentralizing authority, buffering or smoothing, and establishing flexible processes