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Chapter Objectives In this chapter, we focus on two In this chapter, we focus on two

questions: questions: What are the key methods for tracking and What are the key methods for tracking and

identifying opportunities in the identifying opportunities in the macroenvironment?macroenvironment?

What are the key demographic, economic, What are the key demographic, economic, natural, technological, political, and cultural natural, technological, political, and cultural developments?developments?

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Analyzing Needs and Trends in the Macroenvironment TrendTrend FadFad MegatrendsMegatrends

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Given the definitions for fads, Given the definitions for fads, trends, and megatrends presented in trends, and megatrends presented in the text, how would you define the text, how would you define youryour online activities? Can you identify online activities? Can you identify an online trend that is likely an online trend that is likely to grow into a megatrend?to grow into a megatrend?

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The substantial speedup of international The substantial speedup of international transportation, communication, and financial transportation, communication, and financial transactions, leading to the rapid growth of world trade transactions, leading to the rapid growth of world trade and investment, especially tripolar trade (North and investment, especially tripolar trade (North America, Western Europe, Far East)America, Western Europe, Far East)

The movement of manufacturing capacity and skills to The movement of manufacturing capacity and skills to lower cost countries.lower cost countries.

The rising economic power of several Asian countries The rising economic power of several Asian countries in world markets.in world markets.

The rise of trade blocks such as the European Union The rise of trade blocks such as the European Union and NAFTA signatories.and NAFTA signatories.

Identifying and Responding to the Major Macroenvironment Forces

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The severe debt problems of a number of countries, The severe debt problems of a number of countries, along with the increasing fragility of the international along with the increasing fragility of the international financial system.financial system.

The increasing use of barter and countertrade to The increasing use of barter and countertrade to support international transactions.support international transactions.

The move toward market economies in formerly The move toward market economies in formerly socialist countries along with rapid privatization of socialist countries along with rapid privatization of publicly owned companies.publicly owned companies.

The rapid dissemination of global lifestyles.The rapid dissemination of global lifestyles. The gradual opening of major new markets, namely The gradual opening of major new markets, namely

China, India, eastern Europe, the Arab countries, and China, India, eastern Europe, the Arab countries, and Latin America.Latin America.

Identifying and Responding to the Major Macroenvironment Forces

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The increasing tendency of multinationals to transcend The increasing tendency of multinationals to transcend their locational and national characteristics and their locational and national characteristics and become transnational firms.become transnational firms.

The increasing number of cross-border corporate The increasing number of cross-border corporate strategic alliances–for example, MCI and British strategic alliances–for example, MCI and British Telecom, and Texas Instruments and Hitachi.Telecom, and Texas Instruments and Hitachi.

The increasing ethnic and religious conflicts in certain The increasing ethnic and religious conflicts in certain countries and regions.countries and regions.

The growth of global brands in autos, food, clothing, The growth of global brands in autos, food, clothing, electronics.electronics.

Identifying and Responding to the Major Macroenvironment Forces

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Demographic EnvironmentDemographic Environment Worldwide Population Worldwide Population

GrowthGrowth Population Age MixPopulation Age Mix Ethnic and Other Ethnic and Other

MarketsMarkets

Identifying and Responding to the Major Macroenvironment Forces

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Educational GroupsEducational Groups Household PatternsHousehold Patterns Geographical Shifts in Geographical Shifts in

PopulationPopulation From a Mass Market From a Mass Market

to Micromarketsto Micromarkets

Identifying and Responding to the Major Macroenvironment Forces

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Economic EnvironmentEconomic Environment Income DistributionIncome Distribution Savings, Debt, and Savings, Debt, and

Credit AvailabilityCredit Availability

Identifying and Responding to the Major Macroenvironment Forces

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Natural EnvironmentNatural Environment Shortage of Raw MaterialsShortage of Raw Materials Increased Energy CostIncreased Energy Cost Anti-Pollution PressuresAnti-Pollution Pressures Changing Role of GovernmentsChanging Role of Governments

Identifying and Responding to the Major Macroenvironment Forces

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Technological EnvironmentTechnological Environment Accelerating Pace of ChangeAccelerating Pace of Change Unlimited Opportunities Unlimited Opportunities

for Innovationfor Innovation

Identifying and Responding to the Major Macroenvironment Forces

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High Persistence of Core High Persistence of Core Cultural ValuesCultural Values

Existence of subculturesExistence of subcultures SubculturesSubcultures

Shifts of Secondary Cultural Shifts of Secondary Cultural Values Through TimeValues Through Time

Identifying and Responding to the Major Macroenvironment Forces