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Asked a question 4 years ago

What is the importance of environmental scanning in entrepreneurial activity?

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There are rapid changes taking place in the environment which have a great impact on the business.Environmental scanning helps the business to identify inside and outside happenings which can effect the business. SWOT analysis is necessary for the survival and growth of the business.

Importance of environmental scanning: 

1.) Strength - Strength of the firm is all about analysing the internal business environment .After identification of the strength, firm needs to further improve their strengths.

2). Weakness - Every business has their own limitations. Analysing the environment not only helps in identification of strengths but also weaknesses. Firms need to identify these weaknesses as early as possible so that if any, they can take corrective measures.

3). Opportunity - While analysing the environment, firm has to take notice of the opportunity also so that they can grab it much before than their competitors.

4). Threats - There are competitors who can be the threat to the business. Early identification of any threat can be beneficial for efficient working of an organisation.

5). Utilization of resources - Scanning of all the resources whether they are capital,human, natural etc. are helpful in proper assessment of optimum utilization of resources.

6). Survival and growth - SWOT analysis helps the firm in maximizing strengths ,minimising weakness and threats, grabbing the opportunities which will help the firm to surviv and gro in long run.