Strategic managers need to analyze the following important environmental influences. These influences include economic, legislative, technological, social cultural settings and competitive forces (Swayne, Duncan & Ginter, 2013). Strategists conduct an environmental analysis to determine opportunities and threats to their organization. Political changes include government regulations of health plan activity such as privacy of medical records, disclosure rules, and regulations to control health plan abuse. Any moment competitors affect the operations of the organization; the management must adjust to a line with the strategies of the competitors. Technology in an organization generates problem-solving inventions. Social-cultural settings regulate morals, values, and customs of society. The prevailing economic conditions of the country influence the spending patterns of citizens. Therefore, environmental analysis plays a critical role in the survival and prosperity of business activities.
If the organization fails to anticipate change and significant shifts taking place within the environment, they will find themselves out of touch within the market’ needs (Swayne, Duncan & Ginter, 2013). They will be affected due to antiquated technologies, ineffective delivery system, and outmoded management. Therefore, such organizations will not prosper.
Swayne, L. E., Duncan, W. J., & Ginter, P. M. (2013). Strategic management of health care organizations (7th ed.). Hoboken, NJ: Wiley.