Situation Analysis in the Marketing Planning Process

The word analysis has its origin in the old Greekword “ ἀ ναλύειν ” and means “to dissolve” and generally means the “action of taking something apart in order to study it” (wikipedia.org). In economic terms a situation analysis is the analysis of the actual state of a company and to realize its potentials and weaknesses. A situation analysis can be done for every kind of company and in general there is a distinction between external conditions and internal conditions (wikipedia.de).
The external conditions can be divided into firstly the macro-environment and secondly the micro-environment.
The situational analysis is an extremely wide statement whose aim is to to state or find out where the organisation is now in terms of the product or service that they offer to their customers.
Once the firm has specified its goals, it begins with its current situation to devise a strategic plan to reach those goals. Changes in the external environment usually present new ways to reach the goals and new opportunities. The firm also must know its own limitations and capabilities in order to choose the opportunities that it can seek the higher probability of success. The situational analysis thus involves an analysis of both the internal and external environment.
The external environment has two aspects which are micro-environment and macro-environment. Macro-environment affects all firms where as micro-environment affects only the firms in particular industry. The macro-environmental analysis keeps inside economic, political, technological and social factors and sometimes this is point to as a PEST analysis.
A situation analysis may have a large amount of information, plenty of which is not relevant to strategy formulation. To make the information better, it is sometimes useful to categorize the internal factors of the firm as weaknesses and strengths. In addition the external factors as threats and opportunities. Such an analysis...

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