1. Macro Environmental Analysis is an integral part of strategic analysis and it is crucial to understand what should be done by the company to be competitive. It is common to analyze the macro environment by exploring its five forces: political. economic, social, and technological. This so called PEST analysis helps to investigate the trends in the major environmental areas that have a significant impact on organizations’ success and failures.
Another framework for conducting Macro Environmental Analysis was suggested by Porter, thus it received the name Porter’s 5 Forces. This model explores the industry in terms of its main participants: buyers, suppliers, substitutes, competitors and new entrants. An additional 6 force, complementors, was introduced later on. Deeper understanding of the importance of each of the industry forces for the company, as well as of the strength of their bargaining power helps to understand the characteristics of the macro environment, where the company operates.
2.a. There is some contradiction in this argument, as religion is often an integral part of the national culture. If Muslim religion prohibits alcohol production, then wine industry in Turkey and Algeria develops despite the culture rather than under its influence. Extravirgin olive oil industry in Italy and Greece is similarly affected by the cultural tradition. Countries with comparable climate conditions, such as Turkey, but without the culture of oil consumption and production, did not manage to enter the market for extravirgin olive oil successfully.
2.b. The emergence of online MBA and Master’s programs is surely an interesting phenomenon. The article illustrates that many universities took steps in offering their students the flexibility of online education. However, it would be interesting to know also the opinion of employers and to investigate whether online degrees are valued as much as traditional ones. Such research could help to understand whether students should invest in online courses or whether they should rather enroll in more traditional MBA education.
2.c. Industry analysis does not differ much for not-for-profit and for-profit organizations. While the ultimate objectives of for-profit companies is maximizing shareholder wealth, for non-for-profit organizations stakeholder benefits are key. The two goals differ in the beneficiaries of the value created, however in both cases revenue generation is the goal. Therefore, 10-K analysis could be helpful both for not-for-profit and for-profit organizations.
2.d. Although the effect of alcohol prohibition was devastating for the American wine industry, the poor condition of the industry today cannot be attributed solely to this factor. This conclusion can be derived from the fact that other alcohol producers, such as beer breweries, managed to recover much faster than winemakers. Hence, it is important to consider whether the demand for wine was sufficient to sustain industry development and whether wine is a part of American culture today. Moreover, international competition from traditional wine-making countries, such as France and Italy, makes it very difficult for the U.S. to enter the wine market.
2. e. The factors outlined in the text surely have a significant impact on the value chain of hospital industry. However, it could be beneficial to distinguish between not-for-profit hospitals and for-profit ones. While the former are subject to the inefficiencies outlined in the text, the latter are more effective in revenue generation and less prone to inefficiencies. Moreover, some of the problems described are only specific to the U.S. hospitals and not to the industry as a whole.
