Environmental analysis and the planning process in a South African context

Mille , P. A.; Binedell, N. A icle En i onmen al analysis and he planning p ocess in a Sou h A ican con ex Sou h A ican Jou nal o Business Managemen P o ided in Coope a ion wi h: Uni e si y o S ellenbosch Business School (USB), Bell ille, Sou h A ica Sugges ed Ci a ion: Mille , P. A.; Binedell, N. (1982) : En i onmen al analysis and he planning p ocess in a Sou h A ican con ex , Sou h A ican Jou nal o Business Managemen , ISSN 2078-5976, A ican Online Scien i ic In o ma ion Sys ems (AOSIS), Cape Town, Vol. 13, Iss. 3, pp. 113-117, h ps://doi.o g/10.4102/sajbm. 13i3.1182 This Ve sion is a ailable a : h ps://hdl.handle.ne /10419/217802 S anda d-Nu zungsbedingungen: Die Dokumen e au EconS o dü en zu eigenen wissenscha lichen Zwecken und zum P i a geb auch gespeiche und kopie we den. Sie dü en die Dokumen e nich ü ö en liche ode komme zielle Zwecke e iel äl igen, ö en lich auss ellen, ö en lich zugänglich machen, e eiben ode ande wei ig nu zen. So e n die Ve asse die Dokumen e un e Open-Con en -Lizenzen (insbesonde e CC-Lizenzen) zu Ve ügung ges ell haben soll en, gel en abweichend on diesen Nu zungsbedingungen die in de do genann en Lizenz gewäh en Nu zungs ech e. Te ms o use: Documen s in EconS o may be sa ed and copied o you pe sonal and schola ly pu poses. You a e no o copy documen s o public o comme cial pu poses, o exhibi he documen s publicly, o make hem publicly a ailable on he in e ne , o o dis ibu e o o he wise use he documen s in public. I he documen s ha e been made a ailable unde an Open Con en Licence (especially C ea i e Commons Licences), you may exe cise u he usage igh s as speci ied in he indica ed licence. h ps://c ea i ecommons.o g/licenses/by/4.0/ En i onmen al analysis and he planning p ocess in a Sou h A ican con ex PA. Mille G adua e School o Business, Uni e si y o Cape Town N. Binedell GEC Equipmen (P y) L d, Den e The au ho s o his pape examine he ex en o he applica ion o en i onmen al analysis du ing he planning p ocess In Sou h A ican businesses. O e seas, and in he Uni ed S a es in pa icula , sophis ica ed echniques o analysing he en i onmen a e being de eloped, and hese would appea o ha e a eady ma ke in he Sou h A ican en i onmen . Should Sou h A ican business ace ela i ely u bulen imes in he nea u u e, he e will be a need o companies o de elop e ec i e means o analysing changing ends, and o in eg a ing hei indings in o he s a egic planning p ocess. Two sepa a e esea ch su eys we e conduc ed, one o 150 lis ed companies and a second o 15 majo Sou h A ican companies. While mos jou nals and ex s would see he en i onmen al analysis as an In eg al pa o he planning p ocess, he majo i y o companies did no ag ee wi h his iew. S. A . J. Bus. Mgm . 1982, 13: 113-117 Die sk ywe s an hie die a ikel onde soek die ma e waa in omgewingson leding ydens die beplanningsp oses in Suid· A ikaanse onde nemings oegepas wo d. In die bui eland en e al in die Ve enigde S a e, wo d e ynde egnieke i on leding an die omgewing on wikkel en daa behoo 'n goeie ma k hie oo in die Suid-A ikaanse omgewing e wees. lndien Suid-A ikaanse onde nemings in die nabye oekoms ela ie on s uimige ye in die gesig sou s aa , sal di nodig wees da maa skappye e ek iewe manle e on wikkel om die e ande ende neigings e on leed en om hulle be indings me die s a egiese beplanningsp oses e in eg ee . Twee a sonde like na o singopnames is gedoen, een an 'n lys an 150 geno ee de maa skappye en 'n weede an 15 g oo Suid-A ikaanse maa skappye. Alhoewel die mees e ak ydsk i e en handboeke omgewingson leding as 'n in eg ale deel an die beplanningsp oses beskou, he die mees e maa skappye nie me hie die mening saamges em nie. S.·A . Tydsk . Bed y s . 1982, 13: 113-117 P.A. MIie Senio Lec u e , G adua e Sc:hool o Business. Uni e si y o Cape Town. Roadcbosch 7700, Republic o Sou h A ica N ..... ~ Manaae , GEC Equipmen (P y) L d, 322 Main Ree Road, Den e • Republic o Sou h A ica Recei ed May 1982; aa:q, cd June 1982 In oduc ion Whe he he Sou h A ican business en i onmen is becoming ela i ely mo e u bulen when compa ed wi h i s pas o ela i e o o he business en i onmen s is a ma e o conjec u e and indi idual opinion. The de elopmen o echniques o sys emized en i onmen al analysis in he Uni ed S a es indica es ha ei he managemen science is ad ancing in ha sys ema ic p ocedu es a e being de eloped, o ha he en i onmen i sel is becoming inc easingly complex and in e ac i e, and he e o e equi es sys ema ic analysis. P oponen s o u u e esea ch such as Kahn 1 and Be11 2 ad oca e he iew ha he en i onmen is changing mo e apidly han be o e, and is mo ing in undamen ally new di ec ions. The au ho s would sugges ha as a apidly de eloping economy, he complexi y o he Sou h A ican en i onmen is inc easing in a numbe o a eas which impac on he conduc o business. Mo e con o e sial pe haps is he iew ha o a ious easons he Sou h A ican mac o-en i onmen will unde go undamen al shi s, and will be p essu ed in a ious ways which will ine i ably lead o new oppo uni ies and shi s o he business communi y in gene al e ms, and wi hin pa icula indus ies. Table I indica es he na u e o possible sou ces o en i onmen al u bulence in Sou h A ica in he u u e. Should hese issues de elop as p essu e poin s in he en i onmen , and he hypo hesis ha he Sou h A ican business en i onmen aces a ela i ely u bulen ou look be indica ed, hen i is clea ha he e will be p essu e on companies o de elop e ec i e means o analysing hese shi s and ends in he en i onmen in which hey will ope a e. Mo e impo an ly, manage s will need o de elop means o meaning ully in eg a ing he ou come o en i onmen al analysis in o he s a egic planning p ocess. The need o en i onmen al analysis The e olu ion o economic ac i i y has led o he de elop- men o la ge o ganiza ions comp ising a hos o ac i i ies and indi iduals. This inc eased size has in um led o in- c eased complexi y in e ms o dependencies, ela ionships, pu poses and cou ses o ac ion. As a esul , m~age s _ha e had o lea n o a end o hose sec o s o hei en i on- men which demand ac ion. I hey do no , hey end o lose hei compe i i e ad an age, missing oppo uni ies and 114 Table 1 Possible u u e sou ces o u bulence in he sou h A ican en i onmen Economic Con inued escala ion o in la ion Sho age o in es men capi al In e na ional economic isola ion Income dis ibu ion Bal~ce o paymen cycles Black business de elopmen Rising eal expendi u e pe capi a Capi al s labou in ensi e in es men Inc easing mili a y expendi u e Black spending powe The choice be ween a ee ma ke s Socialis economy Di ec ion o in e na ional ade Go e nmen iscal policies Social Popula ion g ow h Pola iza ion o acial g oups Eme gen alue sys ems Educa ion le els Poli ical Eme gen powe dispensa ion Regional s abili y Pola iza ion o poli ical powe cen es Namibian independence esolu ion In e na ional ela ions Inc easing e o ism Labou Skills sho age Rela i e labou cos s P oduc i i y le els Indus ial ela ions Labou un es Physical Ene gy dependence Wa e sho age A able land sh inkage e en ually inc easing hei companies' cos s. In he long un he company's exis ence may e en be h ea ened. The key o he inc eased impo ance o managing a com- pany in ela ion o i s en i onmen is oo ed in he speed o change. D ucke has indica ed ha he cu en pa adigms o he planning p ocess will simply no wo k in u bulen imes. 'Planning s a s ou , as a ule, wi h he ends o yes e day and p ojec s hem in o he u u e - using a di e en "mix" pe haps, bu wi h e y much he same elemen s and con igu a ion. The mos p obable assump ion in a pe iod o u bulence is he unique e en which changes wi h con igu a ion - and unique e en s canno by de ini ion be planned. '3 Ou expe ience sugges s ha mos companies a e no s uc u ed o o ganized in o de o deal wi h a apidly changing en i onmen . Rewa ds and incen i es a e s uc- u ed a ound smoo h g ow h in a simple, p edic able en- i onmen , while he ue en i onmen appea s o be com- plex, unce ain and p oblema ic. Howe e , de elopmen s in he a eas o u u es esea ch and en i onmen al scan- ning may indica e ha managemen is s a ing o ealize ha he e is a need o unde s and and deal wi h hese issues h ough ins i u ionalizing he low o ex e nal in o ma ion which is ele an o i s s a egies and p ospe i y. S.-A . Tydsk . Bed y sl. 1982, l3(l) The s a e o he a Techniques o en i onmen al analysis and u u es esea ch ha e ecei ed inc easing a en ion in jou nals and manage. men jou nals dealing wi h s a egic planning and co po a e s a egy. Fahey and King4 in 1977 showed ha only wo ou o 12 majo co po a ions s udied had es ablished en- i onmen al analysis sys ems and ha e en hose wo com- panies we e scanning on a egula bu no a con inuous basis. 'O e all hese esul s e eal a signi ican gap be- ween he con en ional assump ions conce ning en- i onmen al scanning and i s implemen a ion in la ge co - po a ions. Al hough he end is owa d g ea e sophis ica- ion, no enough e idence o demons a ed impac exis s o wa an a conclusion ha en i onmen al scanning will become a egula elemen o co po a e planning. '5 Recen - ly hey examined he use o a ious en i onmen al analysis echniques. 'Awa e p o essionals' -membe s o he Wo ld Fu u es Socie y -we e asked o a e he cu en usage and pe cei ed u ili y o a ious me hods on a scale o O - 7. Resul s a e shown in Table 2. Table 2 Pe cei ed po en ial u ili y and ac ual usage o o ecas ing me hods Me hod U ili y Usage Scena io w i ing 6,1 4,2 Simula ion 4 2 Mo phological analysis 4,2 2,1 PPBS 2 2 Game heo y 2 2 C oss impac analysis 3,9 2 Inpu -ou pu analysis 4,8 2,9 Field ana noly ela ion 2 2 O he (including Delphi) 6,1 S,1 Sou ce: Fahey, L. and King, R., En i onmen al scanning and o ecas ing in s a egic planning. Long Range Planning, Feb ua y 1981, p.3S Thei gene al conclusions we e ha he a e age le el o p ac ice is low ela i e o he iewpoin exp essed in jou · nals and ex s; he mos sophis ica ed app oach o scan ning appea s o be he es ablishmen o a sepa a e scan ning uni al hough he e is no clea ag eemen o he ap p op ia eness o sepa a e scanning uni s; and ha en i onmen al analysis is no ega ded as su icien ly impo · an o necessi a e a majo deploymen o esou ces. . Thomas on he o he hand concluded ha ' he p e ail· ing s e eo ype o en i onmen al scanning as a ma ginal i o y owe exe cise equi es modi ica ion. In o de o cap- u e he essence o he scanning p ocess, one has o m~ e away om he con en ional mic o iew o a single ID· di idual ca ying ou his unc ion, o a mac o one which is o ganic (i no ully o ganized ye ) in cha ac e .. · (and as a esul ) sys ema ic omni-di ec ional scanning o co · po a e planning is on he h eshold o apid g ow h and de elopmen '6 (au ho s' wo ds in pa en hesis). Co po a e sensi i i y o he en i onmen In o de o de e mine whe he lis ed Sou h A ican com· panies showed inc eased sensi i i y o he mac o en i on· · on men as sugges ed by Thomas and he ex en o en i · men analysis wi hin he o malized planning p ocess, wo S.A . J. Bus. Mgm 1982 13(3) sepa a e esea ch su eys we e conduc ed: One, a mailed ques ionnai e sen o 150 lis ed companies and ano he , a se ies o ocus in e iews wi h 15 majo Sou h A ican companies. Because he au ho s expec ed o encoun e a g ea di e - si y o le els o sophis ica ion anging om ad hoc in o - mal scanning by he chie execu i e o egula o mal analysis by specialis unc ions, he limi a ions o a mail- ed ques ionnai e we e acknowledged and i was accep ed ha a meaning ul pe spec i e could only be added h ough in-dep h discussion wi h execu i es and planning manage s. Objec i es The esea ch objec i es we e: To de e mine he ex en o he use o en i onmen al analysis in Sou h A ican companies, his being seen as pa o he o e all planning p ocess, and o es ablish how he en i onmen al analysis is in- eg a ed in o he planning p ocess and e en ually in- o he managemen cul u e o he company. (O he objec i es we e included bu all ou side he scope o his pape .) The ques ionnai e was sen o 150 lis ed companies chosen on a sys ema ic sampling basis, ha is he o al numbe o lis ed companies di ided by he sample equi ed (450/150) mean ha e e y ou h company was selec ed om he alphabe ical index. This ga e a o al o 135 and a u he 15 we e andomly included. The use o an alphabe ical index ensu ed ha no bias by ype o indus y was possible. A o al o 35 ques ionnai es we e e u ned o which 31 (20,670/o) we e usable. The salien indings o he su ey we e: Findings o ques ionnai e su ey No o mal planning depa men A o al o 21 (67, 70/o) o companies had no o mal plan- ning depa men o pe son assigned o a planning ole. While he au ho s concluded ha his did no necessa ily indica e ha companies wi hou a speci ically assigned planning ask a e poo planne s, he planning ask does equi e specialis skills, and insu icien esou ces o ene gy de o ed o he planning unc ion could lead o poo plan- ning. The planning unc ion in he majo i y o hese com- panies (61 OJo) was ca ied ou by he chie execu i e o ice o he chie inancial o ice indi idually o oge he . Subsequen ly only one o hese companies had i s ma ke ing pe sonnel in ol ed in he planning p ocess. Planning ocus Companies wi h a o mal planning unc ion u ilized a mean planning ime ho izon o 4,4 yea s and hose wi hou had a mean o 3,9 yea s. Gene ally he ocus o mos o mal planning was on he inancial aspec s o he i m, wi h he i e mos popula planning componen s as shown in Table 3. En i onmen al analysis En i onmen al anaiysis a ed ai ly poo ly, wi h only 17 companies (550/o o he su ey) ca ying ou any ype o en i onmen al analysis. O hese, 10 we e among hose wi hou a o mal planning unc ion. The ime ho izon was 3,05 yea s, conside ably sho e han o p ojec ed capi al 115 Table 3 The mos popula planning componen s l17o Time ho izon Planning componen o companies mean alue in yea s I. P ojec ed cash lows 90 3,32 2. P ojec ed income s a emen s 90 3,59 3. P ojec ed capi al in es men s 87 3,88 4. P ojec ed balance shee s 84 2,96 5. Re iew o pas pe o mance 77 1,88 in es men s. The au ho s su mised ha in a dynamic en- i onmen , analysis ime ho izon may be necessa ily sho . En i onmen al sec o s analysed The mac o en i onmen is depic ed in e ms o a diag am made up o six en i onmen al sec o s impac ing on an in- dus y and on indi idual companies (see Figu e 1 ). Responden s we e asked o wha ex en hei companies analysed each en i onmen al sec o (see Table 4). The economic en i onmen is he mos commonly analysed sec o . O he 31 companies ha esponded, 29 ei he analyse o analyse in de ail he economic en i on- men . Compa ed wi h he economic, physical, social and echnological en i onmen s, he poli ical and ins i u- ional/legal en i onmen s ecei e ela i ely li le analy ical a en ion. Clea ly i ms wi h o mal planning unc ions ha e inc eased awa eness o en i onmen al analysis as a whole, and he e o e we e mo e likely o analyse each sec- o , whe eas hose i ms no analysing a pa icula sec o usually dis ega ded his sec o because hey el i was no ele an o hei pa icula indus y. Sou ces o in o ma ion used o he pu poses o he en- i onmen al analysis we e a ied bu he mos popula we e (in descending o de o popula i y) Comme cial bank epo s Depa men o S a is ics Bu eau o Economic Resea ch T ade jou nals Social en i onmen Poli ical en i onmen Economic en i onmen Indus y Company lns i u ionaU .egal en i onmen Physical en i onmen Technological en i onmen Figu e 1 Six en i onmen al sec o s impac ing on indus y and companies 114 Table 1 Possible u u e sou ces o u bulence In he Sou h A ican en i onmen Economic Con inued escala ion o in la ion Sho age o in es men capi al In e na ional economic isola ion Income dis ibu ion Balance o paymen cycles Black business de elopmen Rising eal expendi u e pe capi a Capi al s labou in ensi e in es men Inc easing mili a y expendi u e Black spending powe The choice be ween a ee ma ke s Socialis economy Di ec ion o in e na ional ade Go e nmen iscal policies Social Popula ion g ow h Pola iza ion o acial g oups Eme gen alue sys ems Educa ion le els Poli ical Eme gen powe dispensa ion Regional s abili y Pola iza ion o poli ical powe cen es Namibian independence esolu ion In e na ional ela ions Inc easing e o ism Labou Skills sho age Rela i e labou cos s P oduc i i y le els Indus ial ela ions Labou un es Physical Ene gy dependence Wa e sho age A able land sh inkage e en ually inc easing hei companies' cos s. In he long un he company's exis ence may e en be h ea ened. The key o he inc eased impo ance o managing a com- pany in ela ion o i s en i onmen is oo ed in he speed o change. D ucke has indica ed ha he cu en pa adigms o he planning p ocess will simply no wo k in u bulen imes. 'Planning s a s ou , as a ule, wi h he ends o yes e day and p ojec s hem in o he u u e - using a di e en "mix" pe haps, bu wi h e y much he same elemen s and con igu a ion. The mos p obable assump ion in a pe iod o u bulence is he unique e en which changes wi h con igu a ion -and unique e en s canno by de ini ion be planned. '3 Ou expe ience sugges s ha mos companies a e no s uc u ed o o ganized in o de o deal wi h a apidly changing en i onmen . Rewa ds and incen i es a e s uc- u ed a ound smoo h g ow h in a simple, p edic able en- i onmen , while he ue en i onmen appea s o be com- plex, unce ain and p oblema ic. Howe e , de elopmen s in he a eas o u u es esea ch and en i onmen al scan- ning may indica e ha managemen is s a ing o ealize ha he e is a need o unde s and and deal wi h hese issues h ough ins i u ionalizing he low o ex e nal in o ma ion which is ele an o i s s a egies and p ospe i y. S.-A . Tydsk . Bed y sl. 1982, 13(3) The s a e o he a Techniques o en i onmen al analysis and u u es esea ch ha e ecei ed inc easing a en ion in jou nals and manage- men jou nals dealing wi h s a egic planning and co po a e s a egy. Fahey and King4 in 1977 showed ha only wo ou o 12 majo co po a ions s udied had es ablished en- i onmen al analysis sys ems and ha e en hose wo com- panies we e scanning on a egula bu no a con inuous basis. 'O e all hese esul s e eal a signi ican gap be- ween he con en ional assump ions conce ning en- i onmen al scanning and i s implemen a ion in la ge co - po a ions. Al hough he end is owa d g ea e sophis ica- ion, no enough e idence o demons a ed impac exis s o wa an a conclusion ha en i onmen al scanning will become a egula elemen o co po a e planning. '5 Recen - ly hey examined he use o a ious en i onmen al analysis echniques. 'Awa e p o essionals' -membe s o he Wo ld Fu u es Socie y -we e asked o a e he cu en usage and pe cei ed u ili y o a ious me hods on a scale o 0- 7. Resul s a e shown in Table 2. Table 2 Pe cei ed po en ial u ili y and ac ual usage o o ecas ing me hods Me hod U ili y Usage Scena io w i ing 6,1 4,2 Simula ion 4 2 Mo phological analysis 4,2 2,1 PPBS 2 2 Game heo y 2 2 C oss impac analysis 3,9 2 Inpu -ou pu analysis 4,8 2,9 Field anamoly ela ion 2 2 O he (including Delphi) 6,1 S,l Sou ce: Fahey, L. and King, R., En i onmen al scanning and o ecas ing in s a egic planning. Long Range Planning, Feb ua y 1981, p.35 Thei gene al conclusions we e ha he a e age le el o p ac ice is low ela i e o he iewpoin exp essed in jou - nals and ex s; he mos sophis ica ed app oach o scan- ning appea s o be he es ablishmen o a sepa a e scan- ning uni al hough he e is no clea ag eemen o he ap- p op ia eness o sepa a e scanning uni s; and ha en- i onmen al analysis is no ega ded as su icien ly impo - an o necessi a e a majo deploymen o esou ces. . Thomas on he o he hand concluded ha ' he p e ail- ing s e eo ype o en i onmen al scanning as a ma ginal i o y owe exe cise equi es modi ica ion. In o de o cap- u e he essence o he scanning p ocess, one has o mo e away om he con en ional mic o iew o a single ~- di idual ca ying ou his unc ion, o a mac o one which is o ganic (i no ully o ganized ye ) in cha ac e ... (and as a esul ) sys ema ic omni-di ec ional scanning o co - po a e planning is on he h eshold o apid g ow h and de elopmen '6 (au ho s' wo ds in pa en hesis). Co po a e sensi i i y o he en i onmen In o de o de e mine whe he lis ed Sou h A ican com- panies showed inc eased sensi i i y o he mac o en i on- men as sugges ed by Thomas and he ex en o en i on- men analysis wi hin he o malized planning p ocess, wo S.A . J. Bus. Mgm 1982 13(3) sepa a e esea ch su eys we e conduc ed: One, a mailed ques ionnai e sen o 1 SO lis ed companies and ano he , a se ies o ocus in e iews wi h 15 majo Sou h A ican companies. Because he au ho s expec ed o encoun e a g ea di e - si y o le els o sophis ica ion anging om ad hoc in o - mal scanning by he chie execu i e o egula o mal analysis by specialis unc ions, he limi a ions o a mail- ed ques ionnai e we e acknowledged and i was accep ed ha a meaning ul pe spec i e could only be added h ough in-dep h discussion wi h execu i es and planning manage s. Objec i es The esea ch objec i es we e: To de e mine he ex en o he use o en i onmen al analysis in Sou h A ican companies, his being seen as pa o he o e all planning p ocess, and o es ablish how he en i onmen al analysis is in- eg a ed in o he planning p ocess and e en ually in- o he managemen cul u e o he company. (O he objec i es we e included bu all ou side he scope o his pape .) The ques ionnai e was sen o ISO lis ed companies chosen on a sys ema ic sampling basis, ha is he o al numbe o lis ed companies di ided by he sample equi ed (4S0/150) mean ha e e y ou h company was selec ed om he alphabe ical index. This ga e a o al o 135 and a u he 15 we e andomly included. The use o an alphabe ical index ensu ed ha no bias by ype o indus y was possible. A o al o 35 ques ionnai es we e e u ned o which 31 (20,670/o) we e usable. The salien indings o he su ey we e: Findings o ques ionnai e su ey No o mal planning depa men A o al o 21 (67,70/o) o companies had no o mal plan- ning depa men o pe son assigned o a planning ole. While he au ho s concluded ha his did no necessa ily indica e ha companies wi hou a speci ically assigned planning ask a e poo planne s, he planning ask does equi e specialis skills, and insu icien esou ces o ene gy de o ed o he planning unc ion could lead o poo plan- ning. The planning unc ion in he majo i y o hese com- panies (61 OJo) was ca ied ou by he chie execu i e o ice o he chie inancial o ice indi idually o oge he . Subsequen ly only one o hese companies had i s ma ke ing pe sonnel in ol ed in he planning p ocess. Planning ocus Companies wi h a o mal planning unc ion u ilized a mean planning ime ho izon o 4,4 yea s and hose wi hou had a mean o 3,9 yea s. Gene ally he ocus o mos o mal planning was on he inancial aspec s o he i m, wi h he i e mos popula planning componen s as shown in Table 3. En i onmen al analysis En i onmen al analysis a ed ai ly poo ly, wi h only 17 companies (SSO/o o he su ey) ca ying ou any ype o en i onmen al analysis. O hese, 10 we e among hose wi hou a o mal planning unc ion. The ime ho izon was 3,05 yea s, conside ably sho e han o p ojec ed capi al llS Table 3 The mos popula planning componen s ll!o Time ho izon Planning componen o companies mean alue in yea s I. P ojec ed cash lows 90 3,32 2. P ojec ed income s a emen s 90 3,S9 3. P ojec ed capi al in es men s 87 3,88 4. P ojec ed balance shee s 84 2,96 s. Re iew o pas pe o mance 77 1,88 in es men s. The au ho s su mised ha in a dynamic en- i onmen , analysis ime ho izon may be necessa ily sho . En i onmen al sec o s analysed The mac o en i onmen is depic ed in e ms o a diag am made up o six en i onmen al sec o s impac ing on an in- dus y and on indi idual companies (see Figu e 1). Responden s we e asked o wha ex en hei companies analysed each en i onmen al sec o (see Table 4). The economic en i onmen is he mos commonly analysed sec o . O he 31 companies ha esponded, 29 ei he analyse o analyse in de ail he economic en i on- men . Compa ed wi h he economic, physical, social and echnological en i onmen s, he poli ical and ins i u- ional/legal en i onmen s ecei e ela i ely li le analy ical a en ion. Clea ly i ms wi h o mal planning unc ions ha e inc eased awa eness o en i onmen al analysis as a whole, and he e o e we e mo e likely o analyse each sec- o , whe eas hose i ms no analysing a pa icula sec o usually dis ega ded his sec o because hey el i was no ele an o hei pa icula indus y. Sou ces o in o ma ion used o he pu poses o he en- i onmen al analysis we e a ied bu he mos popula we e (in descending o de o popula i y) Comme cial bank epo s Depa men o S a is ics Bu eau o Economic Resea ch T ade jou nals Social en i onmen Poli ical en i onmen Economic en i onmen Indus y Company lns i u ional/l..8gal en i onmen Physical en i onmen Technological en i onmen Flp e Six en i onmen al sec o s impac ing on indus y and companies 116 S.-A . Tydsk . Bed y sl. 1982, 13(3) Table 4 Analysis o six en i onmen al sec o s Analysed in de ail Analysed No analysed Numbe o esponden s Numbe o esponden s Numbe o esponden s Companies Companies Companies Companies Companies Companies wi h wi hou wi h wi hou wi h wi hou En i onmen al planning planning OJo o planning planning OJo o planning planning OJo o sec o unc ion unc ion o al unc ion unc ion o al unc ion unc ion o al Economic 3 6 29 Physical 2 s 23 Technological 4 4 26 Ins i u ional/legal 0 3 Poli ical 0 1 3 Social 2 10 Time ho izons I was clea om he esponse ha mos companies do undenake o mal planning e en hough no specialis s may ha e been appoin ed o ha unc ion. These o mal plans a e s ill being o mula ed in he mys ical i e yea ime ame which migh indica e he limi a ions o he un- sophis ica ed na u e o he en i onmen al analysis. (Only one i m indica ed any le el o sophis ica ion, his being an in-house econome ic model.) I companies we e o make be e use o hose a ailable sou ces o in o ma ion ha cas a b oade ne wi h longe ime ho izons, hei analyses and planning would be a mo e e ec i e. Findings on 15 companies in e iewed As al eady s a ed, i was el ha he limi ed na u e o a ques ionnai e would na ow he sea ch, so a u he 15 companies we e in e iewed. I was appa en ha he com- panies selec ed we e no ep esen a i e o he ea lie sam- ple o quo ed companies, bu a he ep esen ed some o he mo e ad anced companies in e ms o co po a e plan- ning. The companies in e iewed a e shown by business sec o in Table 5. Table 5 Companies in e iewed, by business sec o Business sec o Indus ial/Conglome a e Oil/Ene gy Se ice Cons uc ion Re ail Mo o Numbe o companies 4 4 4 I was ound ha a signi ican p opo ion o hese com- panies (nine) p ac ise wha we e med low-le el en- i onmen al analysis. This usually in ol ed an annual en- i onmen al analysis as a p elude o he planning p ocess. As wi h he ea lie sample, he en i onmen al analysis e ol es a ound he economic and indus ial en i onmen s including he pa ame e s o he demand unc ion and likely 7 7 6 7 8 7 13 6S 0 2 6 9 S2 7 26 II ss 0 6 19 9 S2 11 39 13 68 2 7 29 IS 71 2 4 19 compe i i e esponses. Usually a single iew o he u u e en i onmen is de eloped and used as a amewo k o he plan. Senio execu i es, subsidia y managemen and di i- sional manage s do no ge in ol ed un il p esen ed wi h he inal epo on he depa men s' o indi idual's indings. Mo e ad anced en i onmen al analysis Six companies p ac ised a mo e ad anced le el o en- i onmen al analysis. Fi s , line manage s a e in ol ed o a g ea e deg ee in he en i onmen al analysis. Second, senio execu i es a e in ol ed on an on-going basis as he en i onmen al analysis is seen as a cen al aspec o he planning p ocess. This seems o inc ease he sensi i i y o hese execu i es o he issues and ends de eloping in he en i onmen , and is likely o de elop an oppo unis ic u u e-o ien ed ou look. As a gene al obse a ion, he in e iews demons a ed ha he le el o en i onmen al analysis is ela ed o he sophis ica ion o he planning p ocess. No companies in- e iewed p esen ed e idence o an ad anced en i onmen- al analysis p ocedu e a e showing ha hei planning p ocess was ough and eady. A common commen om he planne s in e iewed was ha he le el o he en- i onmen al analysis should be ela ed o he le el o he planning p ocess i i is o gain he in e es and pa icipa- ion o line manage s and s a egic decision-make s. I he co ec weigh ing is no main ained, he decision-make is likely o ejec he en i onmen al analysis as being beyond he scope o his pe cep ion, business unc ion o con ex . In eg a ion o analysis In eg a ion o he en i onmen al analysis akes place a wo le els: i s in he minds o he s a egic decision- make s as pan o hei knowledge and cogni i e p ocesses when de eloping plans and s a egies; second, as a w i - en elemen o he planning documen . The mos impo - an aspec is he in eg a ion o in o ma ion and implica- ions o he business which low om he en i onmen al analysis as unde s ood and used by he decision-make · Some co po a e planne s ind hemsel es us a ed by he scan a en ion paid o he en i onmen al analysis and i s applica ion o he de elopmen o s a egy. I is clea ha S.A . J. Bus. Mgm 1982 13(3) oducing documen s a conside able cos , which a e hen p o ed is a a uous exe cise. One o he companies in pa - 1gn , . icula s ood ou because hey had a ela i ely un~e eloped i onmen al analysis p ocess, bu h ough di ec and en . . h' h d eaning ul access o he chie execu i e 1s p ocess a : majo impac on s a egy. This c~n~ as ed wi h hose mpanies which had de eloped soph1s 1ca ed sys ems ha co k' did no di ec ly impac on he s a egy-ma mg p ocess. conclusion While mos o he jou nals and ex s would see he en- i onmen al analysis as an in eg al pa o he planning ; ocess, he majo i y o companies su eyed ca i~d ou ei he ow-le el o limi ed en i onmen al analyses, wi h ew p oducing any hing like he comp ehensi ely esea ched epo s isualized by mos au ho s. Those ha do p oduce such epo s o en ha e di icul y in in eg a ing he in- dings on he annual planning p ocess. On he o he hand, companies wi h low le el en i onmen al analy ical p o- cedu es seemed o ind i easie o in eg a e en i onmen- al analysis wi h he planning p ocess. The au ho s could only conclude ha managemen in many Sou h A ican i ms a p esen do no see he need o ull-scale en- i onmen al analysis as being a high p io i y i em. Based on he au ho s' exposu e o he manage s con- duc ing co po a e planning and exposu e o he echniques and p ocedu es used in co po a e planning, i is clea ha a conside able deg ee o conce n exis s abou he impac 117 o en i onmen al dynamics on co po a e s a egy. The p o- blems seem o be, i s ly, o de elop manageable p o- cedu es and, secondly, o in eg a e hese in o he men al mind maps o bo h he planne s and line managemen . A endency exis s o line manage s and planne s o sh ink back and a oid he mo e unpleasan aspec s and he ho - nie p oblems unco e ed h ough en i onmen al analysis. This is possibly owing o he con o e sial na u e o hese issues and o he di icul ies in e ms o ansla ing hei impac on he co po a e s a egy in o meaning ul and ac- cep able e ms. In conclusion, he au ho s belie e ha he mac o en- i onmen is likely o impose nume ous s a egic issues ha business will ha e o conside in he medium- o long- e m u u e o he Sou h A ican economy. I is impe a i e ha indi idual businesses and he business communi y as a whole e ec i ely deal wi h hese issues. Re e ences I. Kahn, H. & Wei e , A.J. The Yea 2000. London: Macmillan, 1967. 2. Bell, D. The Coming o Pos -Indus ial Socie y. New Yo k: Basic Books, 1973. 3. D ucke , P. Managing in Tu bulen Times. London: Pan Books, 1981. p.9. 4. Fahey, L. & King, R. En i onmen al scanning o co po a e plan- ning, Bus. Ho izons, Augus 1977, Vol.20, No.4, p.71. S. Thomas, P. En i onmen al scanning -The s a e o he a . Long Range Planning, Feb ua y 1980, Vol.13, p.24. _________