Understanding the external environment

Topics in this module

1. 01

   External analysis, data and the CPA role

   Learn how to scope external analysis, collect reliable evidence and use business intelligence, analytics and finance judgement to inform strategy.

   7 sections · 8 min read

   1 video1 PDF3 images

   See the topics covered

   1. External environment, industry and market
   2. Scope the decision before collecting data
   3. Types of data and sources
   4. Reliability, relevance and comparability
   5. Analytics: from signals to interpretation
   6. Data governance and the CPA's contribution
   7. Sources and further reading
2. 02

   Industry boundaries, value chains and life cycles

   Define industry boundaries, map value chains, distinguish integration from outsourcing, and assess industry segments, life cycles and disruption.

   8 sections · 10 min read

   2 videos2 PDFs6 images

   See the topics covered

   1. Industry boundaries and classification
   2. Industry value chains
   3. Value creation and profit capture
   4. Vertical integration, outsourcing and offshoring
   5. Industry segmentation
   6. Industry life cycle
   7. Disruption and industry renewal
   8. Sources and further reading
3. 03

   STEEPLE and industry growth

   Use STEEPLE to explain external drivers of industry growth, prioritise evidence and test strategic decisions against plausible future scenarios.

   9 sections · 10 min read

   2 videos2 PDFs6 images

   See the topics covered

   1. Remote environment and industry demand
   2. The seven STEEPLE dimensions
   3. Social, technological and economic drivers
   4. Environmental, political, legal and ethical drivers
   5. Growth rates: volume, price and market share
   6. Prioritising drivers and their interactions
   7. Scenarios, forecasts and sensitivity analysis
   8. Monitoring and revising the conclusion
   9. Sources and further reading
4. 04

   Industry forces and profitability

   Explain industry profitability with Porter's Five Forces, distinguish rivals from substitutes, and assess complements, changing power and strategic responses.

   9 sections · 11 min read

   2 videos2 PDFs6 images

   See the topics covered

   1. What Five Forces explains
   2. Threat of new entrants
   3. Bargaining power of suppliers
   4. Bargaining power of buyers
   5. Substitutes and the boundary of competition
   6. Rivalry, capacity and exit barriers
   7. Complements, ecosystems and government
   8. Drawing a defensible profitability conclusion
   9. Sources and further reading
5. 05

   Customers, markets and segment selection

   Learn how to segment customers, assess target markets and test their needs, buying behaviour and profitability before choosing a value proposition.

   7 sections · 9 min read

   1 video1 PDF3 images

   See the topics covered

   1. Markets, customers and the buying decision
   2. Bases for market segmentation
   3. When a segment is useful
   4. Selecting target markets
   5. Segment profitability and cost to serve
   6. Testing needs and building a value proposition
   7. Sources and further reading
6. 06

   Competitors, value propositions and strategic groups

   Compare competitors, key success factors and strategic groups, then connect external evidence with positioning, capabilities and strategic action.

   10 sections · 11 min read

   2 videos2 PDFs6 images

   See the topics covered

   1. The basis of competition
   2. Industry key success factors and company strengths
   3. Competitive positioning and generic strategies
   4. Identifying and understanding competitors
   5. Anticipating competitive responses
   6. Comparing positions with a weighted score
   7. Strategic groups and mobility barriers
   8. Digital competition and platform dependencies
   9. From external findings to strategic action
   10. Sources and further reading
7. 

   GSL Module 2 — Practice Quiz

   10 challenging questions on external analysis, STEEPLE, industry life cycles, five forces, markets, competition and leadership. Review full explanations and study-guide page references after submission.

   Practice quiz · Review your understanding