Acme Valves,Inc.,has been a successful player in the oil field supply industry in the last 15 years. Acme maintained its traditional strategy and product characteristics over this time period. However,Acme has experienced declines in sales and profits over the last four quarters. The CEO of Acme should

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A decline in sales and profits suggests that something has changed in the external environment that Acme is operating in. Conducting an analysis of the external environment will help the CEO of Acme understand the changes that have occurred and how the company can adapt its strategy to remain competitive. Simply continuing with the traditional strategy may not be effective if external factors have shifted. Focusing on improving efficiency and cost control may be beneficial, but without understanding the external environment, the company may miss out on potential opportunities or fail to address new threats. Making immediate adjustments to the traditional business strategy without analyzing the external environment could lead to ineffective changes or even exacerbate the problem. Therefore, conducting an analysis of the external environment is the best choice for the CEO of Acme.Valuing only proven strategies over short term solutions is not conducive to businesses innovating and staying relevant in their respective fields.