Chapter 3-External Assessment

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  1. Define external audit, and its purpose
    • EXTERNAL AUDIT- focuses on identifying and evaluating trends and events BEYOND THE CONTROL OF A SINGLE FIRM. Reveals key opportunities & threats confronting an organization.
    • aka- environmental scanning or industry analysis

    • PURPOSE- reveals key opportunities & threats confronting an organization so that managers can formulate strategies to take advantage of opportunities and avoid/reduce the impacts of threats. DEVELOP A FINITE LIST OF OPPORTUNITIES THAT COULD BENEFIT A FIRM & THREATS THAT SHOULD BE AVOIDED. RECOGNIZE MARKET TRENDS
  2. What does identifying and evaluating external opportunities and threats enable for a business?
    It enables organizations to develop a clear mission, to design strategies to achieve long-term objectives, and to develop policies to achieve annual objectives.
  3. List the five broad categories of KEY EXTERNAL FORCES
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Chapter 3-External Assessment

This is part one of Strategic Management mid-term.
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