Scribd

Upload a Document
Internal and External Environment Search Documents
Explore
Documents
Books - Fiction
Books - Non-fiction
Health & Medicine
Brochures/Catalogs
Government Docs
How-To Guides/Manuals
Magazines/Newspapers
Recipes/Menus
School Work
+ all categories
Featured
Recent
People
Authors
Students
Researchers
Publishers
Government & Nonprofits
Businesses
Musicians
Artists & Designers
Teachers
+ all categories
Most Followed
Popular
Shyama Sriram
We're using Facebook to personalize your experience.
Learn MoreDisable
Home
My Documents
My Collections
My Shelf
View Public Profile
Messages
Notifications
Settings
Help
Log Out
Welcome to Scribd - Where the world comes to read, discover, and share...
Were using Facebook to give you reading recommendations based on what your friends are sharing and the things you
like. We've also made it easy to connect with your friends: you are now following your Facebook friends who are on
Scribd, and they are following you! In the future you can access your account using your Facebook login and password.
Learn moreNo thanks
Some of your friends are already on Scribd:
Oxford Strategy Diploma Develop Effective Strategic Decisions For Your Business. www.sbs.ox.ac.uk/strategydi pl oma
Intrinsic Impact A Free Resource on Impact Assessment for the Arts Sector Intri nsi cImpact.org
Innovation Beyond Borders Best practices from thought leaders Enroll now for November, 2011 www.rhsmi th.umd.edu/BeyondBorders/

Theformulaforbusinesssuccessrequirestwoelements-theindividualandthe
environment.Removeeithervalueandsuccessbecomesimpossible. Business
environmentconsistofallthosefactorsthathaveabearingonthebusiness.Theterm
environmentconsistofallthosefactorsthathaveabearingonthebusiness.Theterm
'businessenvironmentimpliesthoseexternalforces,factorsandinstitutionsthatare
beyondthecontrolofindividualbusinessorganisationsandtheirmanagementandaffect
thebusinessenterprise.Itimpliesallexternalforceswithinwhichabusinessenterprise
operates.Businessenvironmentinfluencethefunctioningofthebusinesssystem.Thus,
businessenvironmentmaybedefinedasallthoseconditionsandforceswhichare
externaltothebusinessandarebeyondtheindividualbusinessunit,butitoperateswithin
it.Theseforcesarecustomer,creditors,competitors,government,socio-cultural
organisations,politicalpartiesnationalandinternationalorganisationsetc.someofthose
forcesaffectthebusinessdirectlywhichsomeothershaveindirecteffectonthebusiness.

Totalityofexternalforces:Businessenvironmentisthesumtotalofallthings
externaltobusinessfirmsand,assuch,isaggregativeinnature.
Specificandgeneralforces:Businessenvironmentincludesbothspecificand
generalforces.Specificforcesaffectindividualenterprisesdirectlyandimmediatelyin
theirday-to-dayworking.Generalforces haveimpactonallbusinessenterprisesand
thusmayaffectanindividualfirmonlyindirectly.
Dynamicnature:Businessenvironmentisdynamicinthatitkeepsonchanging
whetherintermsoftechnologicalimprovement,shiftsinconsumerpreferencesorentry
ofnewcompetitioninthemarket.

Uncertainty:Businessenvironmentislargelyuncertainasitisverydifficultto
predictfuturehappenings,especiallywhenenvironmentchangesaretakingplacetoo
frequentlyasinthecaseofinformationtechnologyorfashionindustries.
Relativity:Businessenvironmentisarelativeconceptsinceitdiffersfrom
countrytocountryandevenregiontoregion.PoliticalconditionsintheUSA, for
instance,differfromthoseinChinaorPakistan.Similarly,demandforsareesmaybe
fairlyhighinIndiawhereasitmaybealmostnon-existentinFrance.
! "
Onthebasisoftheextentofintimacywiththefirm,theenvironmentalfactorsmaybe
classifiedintodifferenttypes-internalandexternal.

Theinternalenvironmentistheenvironmentthathasadirectimpactonthebusiness.
Heretherearesomeinternalfactorswhicharegenerallycontrollablebecausethe
companyhascontroloverthesefactors.Itcanalterormodifysuchfactorsasits
companyhascontroloverthesefactors.Itcanalterormodifysuchfactorsasits
personnel,physicalfacilities,andorganization andfunctionalmeans,likemarketing,to
suittheenvironment.
Theimportantinternalfactorswhichhaveabearingonthe strategyand
otherdecisionsof internalorganization arediscussedbelow.
# $
Thevaluesystemofthefoundersandthoseatthehelmofaffairshas
importantbearingonthechoiceofbusiness,themissionandtheobjectivesofthe
organization,businesspoliciesandpractices.
%
Visionmeanstheabilitytothinkaboutthefuturewithimaginationandwisdom.Visionis
animportantfactorinachievingtheobjectivesoftheorganization.Themissionisthe
mediumthroughwhichtheobjectivesareachieved.

&
Thestructureoftheorganizationalsoinfluencesthebusinessdecisions.The
organizationalstructurelikethecompositionofboardofdirectors,influencesthe
decisionsofbusinessastheyareinternalfactors.Thestructureandstyleofthe
organization maydelayadecisionmakingorsomeotherhelpsinmakingquick
decisions.
# ` ( # ) `
Therelationshipamongthethreelevelsoftheorganizationalsoinfluencesonthe
business.Themutualco-ordinationamongthosethreeisaanimportantneedfora
business.Therelationshipamongthepeopleworkinginthethreelevelsofthe
organizationshouldbecordial.
*
Thehumanresourceistheimportantfactorforanyorganizationasitcontributestothe
strengthandweaknessofanyorganization.thehumanresourceinanyorganizationmust
havecharacteristicslikeskills,quality,highmorale,commitment towardsthework,
attitude,etc. Theinvolvementandinitiativeofthepeopleinanorganizationatdifferent
levelsmayvaryfromorganizationtoorganization.Theorganizationalcultureandoverall
environmenthavebearingonthem.
+ ` $ & , $
Theimageofthecompanyintheoutsidemarkethastheimpactonthe
internalenvironmentofthecompany.Ithelpsinraisingthefinance,makingjoint
ventures,otheralliances,expansionsandacquisitions,enteringsaleandpurchase
contracts,launchingnewproducts,etc.Brandequityalsohelpsthecompanyinsame
way.


##
Theotherfactorsthatcontributetothebusinesssuccessorfailureareasfollows:
" ) $ # # :-facilitieslikeproductioncapacity,technologyare
amongthefactorswhichinfluencesthecompetitivenessofthefirm.Theproperworking
oftheassetsisindeedforfreeflowofworkingofthecompany.
) # ` - -ThoughR&Ddepartmentisbasicallydone
externalenvironmentbutithasadirectimpactontheorganization.Thisaspect mainly
determinethe companysabilitytoinnovateandcompete.
. & :-Resourcesliketheorganizationformarketing,qualityof
themarketingmen,brandequityanddistributionnetworkhavedirectbearingon
marketingefficiencyofthecompany.
# :- factorslikefinancialpolicies.financialpositionsandcapital
structurearealsoimportantinternalenvironmentaffectingbusinessperformances,
strategiesanddecisions.

Itreferstotheenvironmentthathasanindirectinfluenceonthebusiness.Thefactorsare
uncontrollablebythebusiness.Therearetwotypesofexternalenvironment.

Themicroenvironmentisalsoknownasthetaskenvironmentandoperatingenvironment
becausethemicroenvironmentalforceshaveadirectbearingontheoperationsofthe
firm.
becausethemicroenvironmentalforceshaveadirectbearingontheoperationsofthe
firm.

Themicroenvironmentconsistoftheactorsinthecompanysimmediateenvironment
thataffecttheperformanceofthecompany.Theseincludethesuppliers,marketing
intermediaries,competitors,customersandthepublic
Themicroenvironmentalfactorsaremoreintimatelylinkedwiththecompany
thanthemacrofactors.Themicroforcesneednotnecessarilyaffectallthefirmsin
aparticularindustryinthesameway.Someofthemicrofactorsmaybeparticular
toafirm.Whenthecompetingfirmsinanindustryhavethesamemicroelements,the
relativesuccessofthefirmsdependsontheirrelativeeffectivenessindealingwiththese
elements
` ` #
Animportantforceinthemicroenvironmentofacompanyisthesuppliers,i.e.,those
whosupplytheinputslikerawmaterialsandcomponentstothecompany.The
importanceofreliablesource/sourcesofsupplytothesmoothfunctioningofthebusiness
isobvious.
+
Themajortaskofabusinessistocreateandsustaincustomers.Abusinessexists
onlybecauseofitscustomers.Thechoiceofcustomersegmentsshouldbemadeby
consideringanumberoffactorsincludingtherelativeprofitability,dependability,
stabilityofdemand,growthprospectsandtheextentofcompetition.
Competition notonlyincludetheotherfirmsthatproducesameproductbutalsothose
firmswhichcompetefortheincomeoftheconsumersthecompetitionhereamongthese
productsmaybesaidasdesirecompetitionastheprimarytaskhereistofulfillthedesire
ofthecustomers. Thecompetitionthatsatisfiesaparticularcategorydesirethenitis
calledgenericcompetition..


. &
Themarketingintermediariesincludemiddlemensuchasagentsand merchantsthathelp
thecompanyfindcustomersorclosesaleswiththem.Themarketingintermediariesare
vitallinksbetweenthecompanyandthefinalconsumers.

Thefinanciersarealsoimportantfactorsofinternalenvironment.Alongwithfinancing
capabilitiesofthecompanytheirpoliciesandstrategies,attitudestowardsrisk,abilityto
providenon-financialassistanceetc.areveryimportant.
" #
Publiccanbesaidasanygroupthathasanactualorpotentialinterestinoronan
organizationsabilitytoachieveitsinterest.Publicincludemediaandcitizens.Growthof
consumerpublicisanimportantdevelopmentaffectingbusiness.

MacroenvironmentisalsoknownasGeneralenvironmentandremote
environment.Macrofactorsaregenerallymoreuncontrollablethanmicroenvironment
factors.Whenthemacrofactorsbecomeuncontrollable,thesuccessofcompanydepends
uponitsadaptabilitytotheenvironment.Someofthemacroenvironmentfactorsare
discussedbelow:

Economicenvironmentreferstotheaggregateofthenatureofeconomicsystem
ofthecountry, businesscycles,thesocio-economicinfrastructureetc.Thesuccessful
businessmanvisualizestheexternalfactorsaffectingthebusiness,anticipating
Internal and External Business Environment
Download this Document for FreePrintMobileCollectionsReport Document
This is a private document.
Info and Rating
m_rizwan23
Like 77 people like this.
Share & Embed
Related Documents
PreviousNext
1.
p.
p.
p.
2.
p.
p.
p.
3.
p.
p.
p.
4.
p.
p.
p.
5.
p.
p.
p.
6.
p.
p.
p.
7.
p.
p.
p.
8.
p.
p.
p.
9.
p.
p.
p.
10.
p.
p.
p.
11.
p.
p.
p.
12.
p.
p.
p.
13.
p.
p.
p.
14.
p.
p.
p.
15.
p.
p.
p.
16.
p.
p.
p.
17.
p.
p.
p.
18.
p.
p.
p.
19.
p.
p.
p.
More from this user
PreviousNext
1.
6 p.
6 p.
10 p.
2.
14 p.
7 p.
12 p.
Recent Readcasters
Add a Comment
Submit
share:
Characters: 400
Betondi Nanjeleft a comment
This is interesting though the name of the author is not mentioned and the yr=ear of publication. It's very
useful!
06 / 09 / 2011
Reply
Hasinur Rahman Hasuleft a comment
Good
05 / 21 / 2011
Reply
Ravi Dwivedileft a comment
thank u it very useful to everyone
03 / 09 / 2011
Reply
Vipin Rawatleft a comment
thanku they r very useful for my project
02 / 24 / 2011
Reply
razekumaleft a comment
thanks ,it is very helpful for making ppts
01 / 16 / 2011
Reply
m_rizwan23 replied:
you are welcome...
02 / 23 / 2011
Upload a Document
Internal and External Environment Search Documents
Follow Us!
scribd.com/scribd
twitter.com/scribd
facebook.com/scribd
About
Press
Blog
Partners
Scribd 101
Web Stuff
Support
FAQ
Developers / API
Jobs
Terms
Copyright
Privacy
Copyright 2011 Scribd Inc.
Language:
English