The first step in analyzing the organization's situation is to assess the environment for opportunities and threats. Two categories of environments must be monitored: the task environment that is shared by every organization in a society; and the general environment, which is unique to a particular organization.

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The first step in analyzing the organization's situation is indeed to assess the environment for opportunities and threats, but the description of the environments is reversed. The task environment is unique to a particular organization and includes elements directly connected to its operations and success, such as customers, competitors, suppliers, and regulators. The general environment, which is shared by every organization in a society, includes broader forces such as economic, technological, sociocultural, political/legal, and international elements that can affect all organizations.

The First Step in Analyzing the Organization's Situation Is to Assess