External Analysis Strategic Management: External Analysis

External analysis in organization is important since it examines the threats and opportunities existing within an environment. The only way of differentiating strength or weaknesses from opportunity or threat is to ask whether the issue exist if companies failed to exist. And if it is true, then this is considered as external to firm. Opportunities is a favorable conditions within the environment and it may produce rewards for most organizations, in short, they are the situations that may exist, however they should be acted upon if firms benefits from them. Threats on the other hand, are barriers that prevent firms from meeting their objectives. External analysis is significant for success of every company (Samuels & Perry, 2005). This paper examines the major threats and opportunities in improving the ability of the McDonalds Company to meet the needs of its stakeholders and make their vision and mission to come about respectively.

Threats

Threats to the company refer to the conditions that are preventing the firms from reaching their objectives. Threats are external to business and it relate to changes in environment which impact the business. Threats reduce the ability of the company to serve its stakeholders well hence failing to make most missions a reality. Factors that lead to threats to McDonalds Company may include the shifts of consumer taste away from the products of the company. In every organization, customers are...

When consumer tastes changes a way from a certain commodity, the McDonalds Company will definitely lose its customers leading to a lower profit as the demand for commodities decreases (Samuels & Perry, 2005).
Emergence of the substitute goods

The emergence of substitute goods is also a major threat to that may affect McDonalds Company's ability to serve its stakeholders well. When there are substitute goods for another commodity, consumers tends to switch to the new product. This may be as a result that, the price of the substitute product tends to be lower than the price of the existing product. Consumers will assume that the substitute good will serve the same purpose hence would rather go for it (Ratnasingam, 2005). The fast food industry is always on the move trying to repackage and substitute foods and additional pieces included so as to make it more attractive then the competitions' food, this will mean McDonald will face this as a threat and will have to find means of coping with it.

Political factors

Other factors like political factors are also threats to the McDonalds Company's ability to serve its stakeholders and make its mission a reality. The government has got policies of intervention by finding out what exact foods they want to provide to the economy and to what extent will be the goods believed to have subsidized firms (Ratnasingam, 2005). Its is true that there are a number stringent guidelines that are within the…