Bill Crawford's Blog

Strategic Management #7 - The Remote Environment

We are a very passion-driven industry that is motivated by causes; our purpose in the world and in the marketplace tends to define us. Hopefully, I’ve helped you with some thoughts about organizing that part of your world, but I am sure that for quite a few of you, that part of things was fully in place.

The research part of Strategic Management is a challenge for many. It is hard. It involves going beyond the “I know this stuff – I’ve been doing it all my life” and gets into some looking under stones to find out what is really going on.

The first area of research is of the “external environment.” I liken this to an onion as it has many layers. I like to define the external environment as the things that are (1) outside our organization, that (2) we cannot control, and that (3) do affect us.

You can see the importance of these things and the need to invest time in researching them by looking at these points in reverse order. If it affects me, it is important! If it affects me and I can’t control it as it is outside my organization, I need to spend time learning about it.

Our goal in learning is not for the sake of knowledge alone, but to put us in a place where we can benefit from elements in the environment that are in harmony with our practices and to help us changes what we are doing to avoid problems from elements in the environment that are contrary to our practices.

We’ll start in the “remote environment.” The primary elements found in a discussion of the remote environment include: Economic Factors, Social Factors, Political Factors and Technological Factors.

Economic Factors – These are probably things that we are all more familiar with that we were six months ago. They include things like prime interest rates, inflation rate, the unemployment rate, the rate of economic growth, etc. These are big things, important things; they are outside of our control, directly affecting our business.

Social Factors – These are bit harder to define precisely, but that is probably true of anything with human beings at its core. Here we are referring to beliefs, values, attitudes, opinions, lifestyle choices, etc. that are held in society. Going back twenty years or so, eating organic foods was a dietary choice held by a small part of society. During the late nineties through the current time, eating organic become more and more an accepted part of a mainstream of society. I read a survey yesterday where only 10% of shoppers indicated that they don’t buy anything organic. The thing to look for here is how are the core products that you bring to the market – organic foods, natural/organic body care and household cleaners, dietary supplements, etc. – viewed and accepted in society. A valid sub-thought to this is whether the current economic challenges are having an effect on this.

Political Factors – With a recent change in administrations in Washington, these are things that we are also paying a lot of attention to. Make no mistake about it; we are not referring here to personalities, to whom you like or don’t like, but rather to specific policies, programs and laws and directly to how those affect your business. How are things that the IRS, FDA, FTC, INS, USDA and others are doing going to affect your customers, your suppliers, your competitors, your neighbors, and you?

Technological Factors – What tools and advances are in the marketplace that help (or hinder) you from serving your customers? What is on the horizon that can help you communicate, predict, or respond better? With our stores being in a more specialty, consumer-focused part of the marketplace, one thing to look at in regards to retail-technology, is that we aren’t so focused on the use of technology that we lose touch with customer service and human interaction. These are tools that should help us serve our customers, not remove us from waiting on them, answering their questions and helping them make good decisions.

The challenge that we face in learning about these things is first to make time in our very busy and information-packed lives to look into these things. From there, we need to become knowledgeable about the topics, trends and issues that affect our businesses. Some of these things are ones that we can help shape. For example, involvement with the Natural Products Association (NPA) via both its national organization and regional associations can put each of us into a position of helping influence legislation. Others of these things (major technological breakthroughs) are ones that we can learn about and be ready to react to in a timely manner.

In any event, there has never been and there certainly is not now a premium on ignorance.

I’ll have the next discussion in this series posted around the 10th of April.

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