The internal environment analysis
The internal environment assessment and analysis is conducted after the external environment analysis. While the external environment analysis seeks to identify opportunities and threats in the external environment, the internal environment analysis seeks to identify the strengths and weakness in your business. Note that it focuses on factors that are internal to your business, some of which can be easily changed or improved upon. The 7’s model is particularly useful when identifying internal factors in your business. It looks at the following:
- Strategy
- Structure
- Style
- Staff
- Skills
- Systems
- Shared values
Using the model is simple, you simply check for the degree to which your business possess the above 7’s. Access which ‘S’ is a strength or weakness in your business. For example, if your business has the right number of people (Staff) and these people possess the right kind of skills, competence and expertise (Skills), then these are considered to be the internal strengths of your business. Where your business lacks Shared values and Systems, these are considered to be weaknesses. This is discussed further below:
1. Strategy
Do your strategies take into account the short term, medium term and long term?
2. Structure
- Do you have a formal organizational structure in place?
- Are clear lines of reporting or communicating present?
3. Style of leadership
What is your style of leadership?
- Participative leadership style
- Democratic leadership style
- Autocratic leadership style
- Dictatorship leadership style
4. Staff
- Do you have competent, skilled and experienced staff to work with?
- How can you manage to keep staff in the current environment ?
- How do you recruit your staff ?
- How trustworthy are your employees?
- Do your staff work long hours?
- How do you retain quality employees?
5. Skills and competencies
What skills and competencies are present in your business?
This may encompass:
- Leadership skills
- Management skills
- Technical skills
- Interpersonal skills
- Intra personal skills
6. Systems, processes and procedures
What systems, processes and procedures do have in place or intend to have in place?
- Performance management system
- Financial management system
- Management information system
- Accounting information system
- Quality control system
- Health and safety
- Stock control system
- Cash control system
- Accounting system
- Expense control system
- Debtors control system
- Creditors control system
- Production related systems
7. Shared values
What qualities or attributes do you base your actions on? What attributes defines the culture of your business? What are the core values of your business? Examples of values include:
- Timeliness
- Reliability
- Convenience
- Driving internal efficiency
- Effectiveness
- Efficiency
- People
- Customer satisfaction
- Customer intimacy
- Transparency
- Accountability
- Brand and business reputation
- Quality
- Innovation
- Creativity
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