1. UNIT 2
ENVIRONMENTAL
ANALYSIS
Environmental Threat and
Opportunity Profile (ЕТОР)

2. Environmental Threat and
Opportunity Profile
(ЕТОР)
It is the process by which organizations
monitor their relevant environment to identify
opportunities and threats affecting their
business for the purpose of taking strategic
decisions.

3. IMPORTANCE OF ETOP
• Helps organization to identify opportunities
and threats
• To consolidate and strengthen organizations
position
• Provides the strategists of which sectors have
a favorable impact on the organization
• Help organization know where it stands with
respect to its environment
• Helps in formulating appropriate strategy
• Helps in formulating SWOT analysis
(Strategic weakness, opportunities and threats)

4. PREPARATION OF
ETOP
Dividing the environment into different
sectors such as economical, market, social,
international, legal, technological, political,
ecological, etc.
Analyzing the impact of each sector on the
organization
Sub-dividing each environmental sector
into sub factors
Impact of each sub-sector on organization
in form of a statement

5. FACTORS OF ETOP PROFILE

7. CASE OF GE OIL & GAS
ETOP ANALYSIS
GE Oil & Gas as an existing organization in this
sector requires to scan the environment from
an industry perspective

8. Internal environment
An organization’s internal
environment consists of the elements
within the organization, including current
employees, management, the
organization’s culture which is defined by
operating procedures and employee
behavior.
A manager’s philosophical or leadership
style directly impacts employees

9. External environment
The external environment of an
organization are those factors outside
the company that affect the
company’s ability to function.
Organizations need to monitor the
basic components of a firm’s external
environment, and keep a close watch
on it at all times.
The external environment consists of
customers, government, economy
and competition.

10. Opportunities and Threats:
External opportunities provide an
organization with a means to improve its
performance and competitive advantage in a
market environment.
Some opportunities can be foreseen, such as
being able to expand a franchise into a new
city.
When organizations can think far ahead, they
can create some opportunities

11. External threats
External threats are anything in the outside
environment that can adversely affect its
performance or achievement of its goals.
Examples of external threats include
• new and existing regulations,
• new and existing competitors,
• new technologies
that may make products or services obsolete,
unstable political and legal systems in foreign
markets and economic downturns.

12. For GE Oil & Gas
The opportunities are:
• According to figures released by America’s Cambridge Energy
Research Associates, India is home to around 64 trillion cubic feet
of unexplored gas at various locations. This gas can be extracted,
and supplied into houses and production units to trigger country’s
growth.
• Demand for oil and gas in India will keep on increasing due to
country’s rising energy needs.
• Oil and gas majors like Cairn, ONGC and Reliance have lined up
plans for huge investments in-order to increase oil and gas
production in the country, which has fuelled the growth.
• GE oil & gas can grow from within by focusing on niche products
and markets where its larger rivals aren’t a factor.
• GE specializes in growth areas such as drilling equipment and
compressors.
• GE is cash rich company. It aspires to continue to develop
technology overlaps between the businesses it has.
• Narendra Modi government is planning to set up several power
plants. It is considering setting up gas based power generation
projects in states like- Madhya Pradesh, Odisha and Uttar
Pradesh. While it plans to set up thermal power plants in states
like Andhra Pradesh, Chhattisgarh, West Bengal, Jharkhand and
Bihar which produce coal

13. For GE Oil & Gas
The threats are:
• The environmental pressure and market demand that oil
companies experience today force them to explore new
industries, i.e. renewables.
• State owned oil and gas companies like ONGC and Oil India
limited are market leaders in the country. However, they
are facing tough competition in oil exploration and
production from private players like Reliance, Essar, Adani,
etc.
• Analysts are doubtful GE Oil & Gas can achieve enough
weight without acquisitions to be a major player in the
industry.
• GE Oil & Gas needs to get bigger and develop a clearer
strategy if it hopes to keep up with its larger competitors.
• The Oil & Gas sector need to emphasize on R&D. India is
weak in it.
• Currently, Dehradun based University of Petroleum and
Energy Studies is considered as the only private University
which offers PHD, post graduate and undergraduate courses
in energy and petroleum. This University aims to create
professionals who can serve India’s rapidly growing oil and
gas Industry.

14. CONCLUSION
This is how ETOP analysis provides
clarity of which sector and sub
sectors have favorable impact on the
organization.
It helps interpret the result of
environment analysis due to which an
organization can assess
its competitive position.