BM midterm - Environmental Scanning Environmental scanning...

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Environmental Scanning Environmental scanning is searching the environment for important events or issues that might affect an organization. Managers scan the environment to stay up-to-date on important factors in their industry. Managers scan the environments to reduce uncertainty Organizational strategies also affect environmental scanning. Managers pay close attention to trends and events that are directly related to the company’s ability to compete, and may come across information by accident. Environmental scanning contributes to organizational performance and helps managers detect environmental changes and problems before they become organizational crises. Furthermore, companies whose CEOs do more environmental scanning have higher profits. CEOs in better-performing firms scan their firm’s environments more frequently and scan more key factors in their environments in more depth and detail than do CEOs in poorer-performing firms. Social Responsibility A business’s obligation to…pursue policies, make decisions, take actions…that benefit society. There are two perspectives on to whom organizations are socially responsible: the shareholder model and the stakeholder model. According to Nobel prize-winning economist Milton Friedman, the only social responsibility that organizations have is to satisfy their owners, that is, company shareholders. This view—called the
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BM midterm - Environmental Scanning Environmental scanning...

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