Question

Business environment or environmental scanning helps in the identification of threats and early warning signals. Explain.

Answer 1

Environmental scanning helps an enterprise to recognize qualitative information in advance, which can be used to prepare it for facing likely challenges. e.g. if any new multinational company is entering the Indian market, the manager of an Indian firm dealing with the same product, like that of the multinational company, should take it as a warning signal. He should take measures like improving the quality of his product, heavy advertisement etc to face the challenge.