1. Why is it important for a firm to study and understand the external environment to create a competitive advantage?

2. What are the differences between the general environment and the industry environment? Why are these differences important? (Discuss Competitor Analysis in your analysis) Competitor Analysis Components a. Future Objective What will our competitors do in the future b. Current Strategy Where do we hold and advantage over competitors c. Assumptions How will this change our relationship with competitors d. Capabilities

3. What is the external Environment analysis process (4 parts)? What does the firm want to learn when using this process?

4. How do the five forces of competition in an industry affect its profit potential?