Scm Draft Case

4.2.3 Socio-cultural

The socio-cultural environment consists of two highly related aspects:

• Demographics

• Cultural trends of society

There are business opportunities that exist in a society’s popular culture, for example, business opportunities for consumer and durable goods, retailing and services, leisure and entertainment and housing and construction.

(a) Demographic changes

They occur due to changes in the population, ethnic groups, and population structure according to age, gender, geographical location, and population distribution of income. These elements are the contributing factors to consumer’s demand, purchasing power and industrial capacity.

Entrepreneurs should also closely examine these elements which contribute to the creation of markets. However, the demographic trend and changes are beyond an entrepreneur’s control. Entrepreneurs need to assess demographic changes in order to identify business opportunities. For example, the increasing number of children in a society can create opportunity for business related activities that service the needs and wants of this particular group, for example children’s education, food and clothes.

(b) Social trends

They relate to the modes and manner in which people live their lives.

Lifestyle reflects the people’s tastes and preferences. Entrepreneurs need to scan and monitor lifestyle changes in order to identify business opportunities. The variables that need attention are household formation, work modes and labour force participation rates, education levels, patterns of consumption and patterns of leisure. Entrepreneurs can use available information from public and private sources of data to scan and monitor these changes. Entrepreneurs also need to forecast and assess the meaning of changes for a new venture by looking after their own self-interest. Thus, they can predict how people behave.

4.2.4 Technology

The branch of knowledge that deals with industrial arts, applied science, engineering, process, invention or method can be defined as technology.

Technological analysis requires scanning and monitoring from the time of basic research through product development and commercialization. Technological change takes two forms:

• Pure invention

• Process innovation

(a) Pure Invention

Pure invention refers to the creation of something new that is different from existing technology or products. For this reason,