Environmental scanning can be termed as the procedure through which an analysis of the factors that affect the performance of an organization is conducted. Aguilar (1997).This paper will focus on the external scanning of the environment so as to evaluate the factors that affected or influenced the performance of apple from outside organization. The external environment consists of various aspects such as the natural physical environment as well as the societal environment. The physical environment consists of elements such as the climate, wildlife and physical resources whereas the societal environment consists of elements such as the political, economic, social cultural and technological forces.
Maintenance of the climate as well as the natural environment is considered to be a corporate social responsibility for any organization. Companies are required to operate in a manner that does not negatively affect the natural environment through pollution. Buchholtz (2006). The natural physical environment has not as yet come to affect or influence the performance of apple. State, local and federal laws that have been enacted have not had an effect on any aspect of apple’s competition, revenues among many others.
The company would however make provisions of how to deal with environmental regulations as some countries have put measures that require the production and marketing of products to be in accordance of the environmental laws. Apple would have to create provisions of how customers would dispose the company’s products after they had arrived at the last part of their useful life. This would necessitate the company to come up with measures of how the customers would turn up the products fro recycling.
The emergence of the environmental regulations in some countries where the organization operates could be termed as a threat since if not properly addressed would lead the company into environmental violations. Hardman Reis (2011).
The societal environment consists of various elements that influence the activities and performance of any organization. With regard to apple various elements influenced its performance and activities. One of the societal elements that influenced the performance of the company was the technological advancements. The organization was largely involved in production of products that were technologically advanced such as ipads, iPods, among many others. This accompanied with a sales team that was able to explain to the customers the benefits of the products enabled the company to have a large market share in the industry. The technological advancements by the company would be considered as opportunities fro the company to go further and develop products that were more technologically advanced.
The legal element of the societal environment also influenced the performance of the organization. The company had to patent its products as well as having rights to copyrights. This was essential as it enabled apple to solely receive the revenues that came from the sale of the products. Apple also applied for patent applications for various innovations that arose from its employees so as to prevent its competitors from benefiting from the same. Despite the negative performance of the US and world economy apple was able to perform reasonably well and it was not affected the poor performance of the world economy. The legal element of the environment could be termed as a threat since innovative ideas that were had no patent could be used by the competitors of the organization.
One of the elements that characterized the industry environment is the threat of new entrants. Porter, M.E. (2008). Organizations in the technological industry of computers and other related products were always faced with the threat of new companies entering the industry. This would result to a reduction of the market share of the existing companies as the companies that were successful in entering the industry would take up some share of the market.
Apple was also faced with the threat of substitute products. When the organization was on a down run customers opted to use products that would serve almost similar purpose as those of Apple. The industry that Apple was operating in also had rivalry between existing firms. This could be termed as competitors who were determined at ensuring that they gained the most from the existing market. Pale had therefore to ensure that it was consistent in delivery of products that were of high standards.
The bargaining power of buyers with regard to Apple was not that strong as the company provided products that were of high quality. It was then possible for the company to fix prices that buyers felt comfortable with in comparison with the value and quality of the products that they purchased. The bargaining power of suppliers can be termed as the ability of suppliers of raw materials and other inputs to influence the prices and other terms of supply. David Mills (2010).With regard to Apple the bargaining power of suppliers of some key components could be termed as high as the company had only one source for some of its key components.
Porter, M.E. (2008) The Five Competitive Forces That Shape Strategy, Harvard business Review.
Hardman Reis (2011)Compensation for Environmental Damages Under International Law, Kluwer Law International, The Hague.
Aguilar, F. (1997). Scanning the business environment. New York: Macmillan.
Buchholtz (2006). Business and Society: Ethics and Stakeholder Management, 6th ed. Mason, OH: Thomson/South-Western.
David Mills, (2010). Supplier power and industry structure: review of industrial organization. New York.