Business environments presentation
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Transcript of Business environments presentation
BUSINESS ENVIRONMENTS BY
PETUNIA F. MAKHUNGA
WHAT IS BUSINESS ENVIRONMENT?
• BUSINESS ENVIRONMENT CONSISTS OF ALL THE
FACTORS THAT HAVE A BEARING ON THE BUSINESS SUCH
AS THE STRENGTHS, WEAKNESSES, INTERNAL POWER
RELATIONSHIPS AND ORIENTATIONS OF THE
ORGANIZATION, GOVERNMENT POLICIES.
BUSINESS ENVIRONMENT IS THE SUM TOTAL OF ALL
FACTORS INTERNAL & EXTERNAL TO THE BUSINESS FIRM
THAT GREATLY INFLUENCE THEIR FUNCTIONING
IT COVERS FACTORS AND FORCES LIKE CUSTOMERS,
COMPETITORS, SUPPLIERS, GOVERNMENT, AND THE
SOCIAL, CULTURAL, POLITICAL, TECHNOLOGICAL AND LEGAL
CONDITIONS.
FEATURES OF BUSINESS ENVIRONMENT
THE CHANGES IN BUSINESS ENVIRONMENT ARE
UNPREDICTABLE.
BUSINESS ENVIRONMENT DIFFERS FROM PLACE TO PLACE,
REGION TO REGION AND COUNTRY TO COUNTRY. EX:
POLITICAL CONDITIONS IN INDIA DIFFER FROM THOSE IN
PAKISTAN. TASTE AND VALUES CHERISHED BY PEOPLE IN
INDIA AND CHINA VARY CONSIDERABLY.
Types of environment
Internal environment External environment
Market environment Macro environment
ENVIRONMENT OF BUSINESS
Micro Environment
TYPES OF ENVIRONMENT
• ON THE BASIS OF THE EXTENT OF INTIMACY WITH THE
FIRM, THE ENVIRONMENTAL FACTORS MAY BE
CLASSIFIED IN TO DIFFERENT TYPES OF LEVELS:
• INTERNAL FACTORS: CONTROLLABLE AND DIRECT
IMPACT ON BUSINESS
• EXTERNAL FACTORS: UNCTROLLABLE AND INDIRECT
IMPACT ON BUSINESS
INTERNAL ENVIRONMENT
• THE INTERNAL FACTORS ARE GENERALLY REGARDED AS CONTROLLABLE FACTORS BECAUSE THE COMPANY HAS CONTROL OVER THESE BECAUSE THE COMPANY HAS CENTRAL OVER THESE FACTORS; IT CAN ALTER OR MODIFY SUCH FACTORS AS ITS PERSONNEL, PHYSICAL FACILITIES, ORGANIZATION AND FUNCTIONAL MEANS, SUCH AS MARKETING MIX TO SUIT THE ENVIRONMENT.
MICRO ENVIRONMENT
MISSION
VISION
OBJECTIVES
BUSINESS FUNCTIONS
MANAGEMENT STRUCTURE
ORGANIZATIONAL CULTURE
A VISION IS A BROAD EXPLANATION OF WHY THE FIRM EXISTS
AND WHERE IT IS TRYING TO LEAD ITGIVES THE ORGANISATION
A SENSE OF PURPOSE AND A SET OF VALUES THAT UNITE
EMPLOYEES IN A COMMON DESTINY.
A MISSION STATEMENT OUTLINES THE FUNDAMENTAL
PURPOSE OF THE ORGANISATION.
OBJECTIVES THEREFORE, REPRESENT THE OPERATIONAL
SIDE OF AN ORGANISATION
BUSINESS FUNCTIONS REFER TO A SET OF OPERATIONS THAT
ARE EXECUTED REGULARLY TO CARRY OUT A PART OF THE
MISSION FOR AN ORGANISATION. THIS TERM CAN ALSO BE
DEFINED AS THE ESSENTIAL FUNCTIONS SUCH AS SALES AND
PRODUCTION THAT AN ORGANISATION CANNOT DO WITHOUT.ORGANIZATIONAL STRUCTURE, COMPOSITION OF BOARD OF
DIRECTORS, EXTENT OF PROFESSIONALIZATION OF
MANAGEMENT SOMETIME DELAY DECISION MAKING WHILE
SOME OTHERS FACILITATE QUICK DECISION MAKING
• ORGANIZATIONAL CULTURE IS THE BEHAVIOUR OF HUMANS WHO
ARE PART OF AN ORGANIZATION AND THE MEANINGS THAT THE
PEOPLE ATTACH TO THEIR ACTIONS. CULTURE INCLUDES THE
ORGANIZATION VALUES, VISIONS, NORMS, WORKING LANGUAGE,
SYSTEMS, SYMBOLS, BELIEFS AND HABITS. IT IS ALSO THE
PATTERN OF SUCH COLLECTIVE BEHAVIOURS AND ASSUMPTIONS
THAT ARE TAUGHT TO NEW ORGANIZATIONAL MEMBERS AS A WAY
OF PERCEIVING, AND EVEN THINKING AND FEELING.
ORGANIZATIONAL CULTURE AFFECTS THE WAY PEOPLE AND
GROUPS INTERACT WITH EACH OTHER, WITH CLIENTS, AND WITH
STAKEHOLDERS.
EXTERNAL ENVIRONMENT
• MARKET ENVIRONMENT: IS ALSO KNOWN AS TASK ENVIRONMENT AND
OPERATING ENVIRONMENT BECAUSE THE MICRO ENVIRONMENTAL
FORCES HAVE A DIRECT BEARING ON THE OPERATIONS OF THE FIRM
• MACRO ENVIRONMENT: IS ALSO KNOWN AS GENERAL ENVIRONMENT
AND REMOTE ENVIRONMENT. MACRO FACTORS ARE GENERALLY
MORE UNCONTROLLABLE THAN MICRO ENVIRONMENT FACTORS.
• WHEN THE MACRO FACTORS BECOME UNCONTROLLABLE, THE
SUCCESS OF COMPANY DEPENDS UPON ITS ADAPTABILITY TO THE
ENVIRONMENT.
o MARKET ENVIRONMENT
SUPPLIERS
EMPLOYEES
CUSTOMERS
COMPETITORS
INTERMEDIARIES
STAKEHOLDERS
COMMUNITY
SUPPLIERS ARE THOSE WHO SUPPLY THE INPUTS LIKE RAW
MATERIALS AND COMPONENTS TO THE COMPANY. THE
IMPORTANCE OF RELIABLE SOURCE/SOURCES OF SUPPLY TO
THE SMOOTH FUNCTIONING OF THE BUSINESS IS OBVIOUS.
CUSTOMER IS A PERSON WHO PURCHASES AND USES GOODS
AND SERVICES
COMPETITORS NOT ONLY INCLUDE THE OTHER FIRMS THAT
PRODUCE SAME PRODUCT BUT ALSO THOSE FIRMS WHICH
COMPETE FOR THE INCOME OF THE CONSUMERS THE
COMPETITION HERE AMONG THESE PRODUCTS MAY BE SAID AS
DESIRE COMPETITION AS THE PRIMARY TASK HERE IS TO
FULFILL THE DESIRE OF THE CUSTOMERS.
INTERMEDIARIES INCLUDE MIDDLEMEN SUCH AS AGENTS AND
MERCHANTS THAT HELP THE COMPANY FIND CUSTOMERS OR CLOSE
SALES WITH THEM. THE MARKETING INTERMEDIARIES ARE VITAL
LINKS BETWEEN THE COMPANY AND THE FINAL CONSUMERS
STAKEHOLDER IS A PERSON, GROUP OR ORGANIZATION THAT HAS
INTEREST OR CONCERN IN APARTICULAR ORGANIZATION
COMMUNITY IS ANY GROUP THAT HAS AN ACTUAL OR POTENTIAL
INTEREST IN OR IMPACT ON AN ORGANIZATION’S ABILITY TO ACHIEVE
ITS INTERESTS. EX-MEDIA, CITIZENS, LOCAL PUBLIC ETC.
EMPLOYEES ARE THOSE PEOPLE THAT WORK FOR THE
ORGANIZATION.
MACRO ENVIRONMENT
ECONOMIC ENVIRONMENTPOLITICAL ENVIRONMENTTECHNOLOGICAL ENVIRONMENTSOCIAL ENVIRONMENTGLOBAL ENVIRONMENT
ECONOMIC ENVIRONMENT REFERS TO THE AGGREGATE OF THE
NATURE OF ECONOMIC SYSTEM OF THE COUNTRY, BUSINESS
CYCLES, THE SOCIO-ECONOMIC INFRASTRUCTURE
IT INCLUDES FACTORS SUCH AS CHARACTERISTICS AND POLICIES
OF THE POLITICAL PARTIES, NATURE OF CONSTITUTION AND
GOVERNMENT SYSTEM RELATING TO BUSINESS POLICIES AND
REGULATIONS
TECHNOLOGICAL ENVIRONMENT INFLUENCES THE BUSINESS IN
TERMS OF INVESTMENT IN TECHNOLOGY,CONSISTENT
APPLICATION OF TECHNOLOGY AND THE EFFECTS OF
TECHNOLOGY ON MARKETS.
THE SOCIAL DIMENSION OR ENVIRONMENT OF A NATION
DETERMINES THE VALUE SYSTEM OF THE SOCIETY WHICH, IN
TURN AFFECTS THE FUNCTIONING OF THE BUSINESS.
THE GLOBAL ENVIRONMENT REFERS TO THOSE FACTORS
WHICH ARE RELEVANT TO BUSINESS SUCH AS WTO PRINCIPLES
AND AGREEMENTS, INTERNATIONAL CONVENTIONS, TREATIES,
AGREEMENTS, DECLARATIONS, PROTOCOLS, ECONOMIC
• REFERENCES
• THAKUR. A, SINGH. D, EKTA, BANSAL. K, MUSTAFA. (2012). BUSINESS ENVIRONMENTS.
HTTP://WWW.SLIDESHARE.NET/EKTA2407/BUSINESS-ENVIRONMENT-11464424.
ACCESSED ON 04/03/2014
• MATCH. P. (2013). BUSINESS ENVIRONMENTS. HTTP://
WWW.SLIDESHARE.NET/DANIYALT/BUSINESS-ENVIRONMENT-26301669. ACCESSED ON
04/03/2014
• SINGH. A. (2009) BUSINESS ENVIRONMENTS. HTTP://
WWW.SLIDESHARE.NET/SINGHANSHU21/FIRST-CHAPTER. ACCESSED ON 04/03/2014
• AHMAD. M.(2012). BUSINESS ENVIRONMENTS. HTTP://
WWW.SLIDESHARE.NET/MUNIF/BUSINESS-ENVIRONMENTS. ACCESSED ON 04/03/2014
• SELVA. A. (2013) BUSINESS ENVIRONMENTS. HTTP://
WWW.SLIDESHARE.NET/ARUNSELVA11/BUSINESS-ENVIRONMENT-25086837.
ACCESSED ON 04/03/2014