CSEET · Economic and Business Environment · Business Environment
Why do firms carry out environmental scanning of the external environment?
Firms scan the external environment to identify opportunities and threats early so they can adapt strategy and decisions. Scanning cannot remove uncertainty or control government policy, and internal weaknesses are identified through internal analysis rather than external monitoring.
- ATo eliminate all uncertainty and risk from business decisions
- BTo identify opportunities and threats so that strategy can be adjustedCorrect
- CTo control the government policies that affect the industry
- DTo reduce the internal weaknesses of the organisation directly
Explanation
Environmental scanning means monitoring external forces to spot opportunities and threats early and shape strategy accordingly. It cannot remove uncertainty or control government policy. Internal weaknesses are addressed through internal analysis, not external scanning.
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