Question

Distinguish between the remote and near environments. How do each support the strategic planning process?

Distinguish between the remote and near environments. How do each support the strategic planning process?

Answer 1

Remote & Near Environments-Strategic planning
Remote environment is defined as the political, ecological, social and technological factors that affect a firm’s ability in freedom and decision making. But the forces are more out of control of the firm. Firms are more bound to make plans and strategies accordingly how the remote environments behave. The characteristics of these forces help the firms to adopt strategies that influence their performance. A positive attitude of the remote environment could help in framing a strategic planning more easily and effectively. Political atmosphere will affect the strategies effortlessly if they are more supportive to the production process and vice versa. The way the ecology behaves, the availability of technological factors, the social response to the industry could all affects in forming a strategic planning. They are all directly related to the easiness in efforts for framing strategic planning.
Near environment refers to the competitive business environment which includes organizations, businesses, banks and government bodies. These all factors ad an environment will affect the functioning of a market or a company which they have influence over that. These are consists of all set of factors which could influence the performance or activities of firms. The firms make strategic planning in accordance of these factors which they can influence. The competition from different firms, consumers, distributors and other contractors, trade unions etc. the firms could adopt strategies with the available information and also influences the near environments. The behavior of these environments helps firms to adopt strategies accordingly and increase their own performance. Thus near factors help firms or companies to frame strategies according to the available information about the environment and influence the market