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30 Minute Business Analysis STEEP

April 2008 (Creativebias)
We all know that sound business planning is vital, and that monitoring your business regularly is really important too. Instead of wading through tomes of theoretical texts, this is the first of three help sheets which aim to explain the rudiments of 3 fundamental business models. Using them will make it easier to pull your thoughts together. At the end of each article, there is a template to help you work through that model.

The models presented are:

1) STEEP (general awareness of the industry or service area you operate in)

2) SWOT (specific analysis of your own business)

3) The ANSOFF Matrix (exploring the possibilities for business development)

STEEP and SWOT are tools you should use at the business planning stage, and as part of your annual business review. It will take you about 30 minutes to complete each one.

The ANSOFF matrix will help once your business is established, and you’re deciding which direction to follow in the future. Once your mind is focused, it takes about 30 minutes to think through.

If it’s the first time you have come across these tools, and don’t find it easy to envisage the outcome, have a look at completed examples of all three models, focusing on an interior design business: STEEP, SWOT and ANSOFF.


STEEP

The STEEP model (which is an updated version of the original PEST model) encourages you to take a step back from your business, and look at the big picture. It’s a tool to help you think about the wider issues that have an impact on the industry or service area as a whole, taking five main categories into account. STEEP is an acronym for Socio-cultural, Technological, Economic, Environmental and Political factors.

The following diagram suggests some of the issues that might affect the industry you operate in. This list, however, is not exhaustive, and you’ll probably be able to add some extra topics in each category. Don’t worry too much about which category a topic fits into – the key point is that you’ve highlighted a factor to consider.





Potential Topics





Socio-cultural

Target market: age range; income brackets; gender specific? cultural leanings? life-style and leisure patterns; changes in social trends; shopping trends



Technological

IT for business management (hardware and software); ICT for communicating with other businesses and clients; equipment and materials (quality, cost and new developments)



Economic


General economic trends; interest rates; tax and insurance; funding sources and requirements



Environmental



Sustainability; recycling; waste disposal; energy-efficiency; fuel



Political

EU and national legislation; local by-laws; trade unions; Health and Safety; Equality legislation; working with vulnerable people; party politics and potential elections


Using the template below, (not forgetting to add other relevant issues), write brief comments about the topics that affect your industry. Bear in mind that they may not all be applicable at the moment, but could be in the future, when you do your annual review. Once the STEEP analysis in complete, you will have a summary of the major factors in your industry or service sector, and therefore a greater understanding of both the scope of your business, and challenges that lie ahead.


STEEP Template

Socio-cultural

Age range

Income brackets

Gender?

Ethnicity?

Life-style

Leisure

Social trends

Shopping trends

Other

Other

Technological

Hardware

Software

IT for management

ICT for communication

Equipment

Materials

New developments

Other

Other

Economic

General trends

Interest rates

Tax

Insurances

Funding sources

Funding req’s

Other

Other

Environmental

Sustainability

Recycling

Waste disposal

Energy-efficiency

Fuel

Other

Other

Political

EU law

National law

Local by-laws

Trade unions

Health & Safety

Equality

Vulnerable people

Party politics

Other

Other

 

 


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