Examples of opportunities

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Examples of opportunities
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Opportunities are generated by factors external to the organization, It is the possibility that organization can use to achieve better market and financial results. Managers should clearly distinguish the opportunities from the strengths of the organization (which are also the opportunity for growth certainly, but stemming from internal factors). An opportunity within the meaning of strategic management, is always something outside the organization, something on what the leadership does not have direct effect, something that can change in an unexpected way without relations to the company's activities. Opportunities, unlike threats, are always positive, i.e. they can be used to improve the situation of the company. Management (as well as employees of the company) should actively seek opportunities that can be used to improve the company's profits.

Types of opportunities can be divided depending on the nature of the environmental factor which is their source. The most distinguished sources of opportunities in the environment of the company, are:

Political factors

  • power in the country has been taken over by political forces favoring economic development and freedom in decision-making,
  • the industry in which the company operates is a priority in the political program of the party which seized power,
  • political climate prevailing in the country, contributes to the strengthening of cooperation and trust between business and government organizations,
  • social unrest and armed conflicts outside the country, increase demand for services and domestic products,
  • customs and tax policy is getting more relaxed and promote investment activities.
  • there are no abrupt changes in the political arena, major parties maintain a stable position, there is no danger of electoral victory of extremist parties,

Economic factor influencing business

  • new markets emerge due to economic integration between countries,
  • demand for products and services in the industry in which the company operates is growing steadily,
  • most large competitors reduces its activities in the market, due to its relatively low profitability,
  • customers generate a huge number of innovative ideas for new products and services that address their current and future needs,
  • interest rates are reduced which increases the availability of credit and investment potential of the company,
  • barriers to entry to the market served by the company are high, which limits the possibility of the emergence of new competitors,
  • stable level of inflation allows for long-term planning and investments in material procurement,
  • favorable exchange rates increase the profitability of exports and limit competition from abroad,
  • economy is in a phase of stable growth, resulting in an increase in consumer demand and investment,
  • consumer wealth increases, resulting in a general increase in demand in the economy,
  • there are many possibilities of financing investment activities through the support of public funds (e.g. European, national, regional),

Social and cultural factors

  • globalisation attracts potential buyers from around the world,
  • social networks generate fashion for products and services of the industry in which the company operates,
  • changing demographic profile of the population increases the demand for products and services offered by the company,
  • population growth translates into a potential long-term growth in demand,
  • awareness is growing in terms of health and safety, which results in an increase in demand for our services,
  • age structure of the population in a market served by the company is favorable, increasing the number of people in the age group which is a target market for company's products,
  • people are susceptible to advertising and react positively to a variety of promotional activities,
  • there is a generally positive attitude concerning the assessment of the economic situation and job prospects in the future,
  • people return from work abroad seeing improving employment prospects and careers in the country,

Technological factors

  • improved access to technology and patents resulting from the globalisation, open communication channels and cooperation between businesses
  • development of information technology in the field of design and simulation, raises the possibility of creating new product solutions and reach new customers,
  • almost unlimited access to information about the activities of competitive companies using the Internet and communication technologies,
  • increasing access to technology of automated production, which reduces the need for human labor and increases the productivity of manufacturing,
  • activity of scientific research carried out in cooperation with the scientific units translates to the emergence of new and more efficient production technologies,
  • the state provides direct financial support to initiatives of enterprises involving setting up a research and development centers,
  • the state supports initiatives to patent protection of new technologies and their implementation in the form of new innovative products,
  • speed of technological change allows the company to regular renewal of the machine park without incurring excessive costs and risks,
  • new technologies that reduce energy consumption in industrial processes become available,
  • life cycle of products and technologies allows the company to obtain a fair return on investment in technological development,

See more examples of Technological factors affecting business.

Legal factors affecting business

Positive legal factors affecting business include:

  • changing laws make it easy to conduct business,
  • licenses and permits are liquidated in the industry in which the company intends to operations, which reduces the barriers to entry to new market
  • importance of trade barriers (customs, tax) in international trade is reduced in the industry in which the company operates,
  • constraints arising from labor law and reduce the influence of trade unions are becoming relaxed,

Natural environment factors

  • increasing pollution increases the demand for products,
  • restrictions on competitors producing toxic waste, improve the position of the company on the market,
  • changing climatic conditions in the area, on which the company can operate, causes increasing number of potential customers,
  • constraints arising from environmental law positively affect their ability to sell new innovative products,
  • promotion and financing of renewable energy sources increases the demand for products,

Ethical factors

  • increasing emphasis on corporate social responsibility increases the profitability of companies led by management adhering to ethical standards,
  • more and more potential business partners emphasizes the important role of trust for companies that comply with high ethical standards.

See also other: Ethical factors affecting business

Author: Krzysztof Wozniak