The business world is a very competitive and shrewd environment that can bankrupt you in the blink of an eye. To prevent this from happening, many business rely on what's called an external factor evaluation (EFE). An EFE is a type of analysis thats used to examine a businesses external environment to identify any opportunities and threats the business may face. The goal for this tool is to identify as many external opportunities and threats as possible, so that the business can fully evaluate where they stand and what they can be doing better. Once the analysis is completed and all threats and opportunities have been identified, the business can start to formulate new strategies and areas of focus. The can decide to delegate more resources to areas they are struggling in, explore ways to take advantage of new opportunities, and even take inspiration from competitors to improve their overall business. Conducting an EFE is critical to stay on top of new trends and strengthen areas of your business you may not have known needed to be improved