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    Chapter-1 Introduction To Business Environment

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    yougeshgoriya1
    The document discusses the business environment and its internal and external factors. It defines business environment as all factors that influence a business. The environment is classified into macro and micro. Macro includes political, economic, social, technological, and global forces outside a firm's control. Micro includes suppliers, customers, competitors, and other forces in a firm's task environment that directly affect its operations. The document also discusses a company's internal environment, including its values, management structure, human resources, brand equity, assets, and financial capabilities. All these internal and external factors shape opportunities and threats for a business.

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    Chapter-1 Introduction To Business Environment

    Uploaded by

    yougeshgoriya1
    480 views26 pages
    The document discusses the business environment and its internal and external factors. It defines business environment as all factors that influence a business. The environment is classified into macro and micro. Macro includes political, economic, social, technological, and global forces outside a firm's control. Micro includes suppliers, customers, competitors, and other forces in a firm's task environment that directly affect its operations. The document also discusses a company's internal environment, including its values, management structure, human resources, brand equity, assets, and financial capabilities. All these internal and external factors shape opportunities and threats for a business.

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    Chapter-1 Introduction to Business Environment

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    The document discusses the business environment and its internal and external factors. It defines business environment as all factors that influence a business. The environment is classified into macro and micro. Macro includes political, economic, social, technological, and global forces outside a firm's control. Micro includes suppliers, customers, competitors, and other forces in a firm's task environment that directly affect its operations. The document also discusses a company's internal environment, including its values, management structure, human resources, brand equity, assets, and financial capabilities. All these internal and external factors shape opportunities and threats for a business.

    Copyright:

    Attribution Non-Commercial (BY-NC)
    Download as PPT, PDF, TXT or read online from Scribd
    Download as ppt, pdf, or txt
    480 views26 pages

    Chapter-1 Introduction To Business Environment

    Uploaded by

    yougeshgoriya1
    The document discusses the business environment and its internal and external factors. It defines business environment as all factors that influence a business. The environment is classified into macro and micro. Macro includes political, economic, social, technological, and global forces outside a firm's control. Micro includes suppliers, customers, competitors, and other forces in a firm's task environment that directly affect its operations. The document also discusses a company's internal environment, including its values, management structure, human resources, brand equity, assets, and financial capabilities. All these internal and external factors shape opportunities and threats for a business.

    Copyright:

    Attribution Non-Commercial (BY-NC)
    Download as PPT, PDF, TXT or read online from Scribd
    Download as ppt, pdf, or txt
    of 26

    CHAPTER-1 BUSINESS ENVIRONMENT

    Ms. Meera Mody

    Business Environment
    Business environment consists of all those factors that have a bearing on the business

    Concept

    Survival and success of any individual depend on


    His

    innate capability to cope with the environment The extent to which the environment is conducive

    Definition The environment include factors outside the firm which can lead to opportunity for and threats to the firm Glueck & Lawrence

    Types of Environment
    On the basis of the extent of intimacy with the firm, the environmental factors are classified Factors are classified in to two

    Internal

    factors External factors


    Micro/task/operating

    environment

    Macro Environment

    Political/govt. Legal Demographic Social/cultural Technological Global

    Micro factors

    Financiers Suppliers Public Customers Competitors Marketing intermediaries Promoters/shareholders


    values Mission/objectives Mgt. sturcture Internal power relationship Physical assets and facilities Co. image/ brand equity Human resources Financial capabilities Technological capabilities Marketing capabilities

    Internal Environments

    Interna l Enviro nment

    Micro Enviro nment


    Macro Environme nt

    Macro Environment
    Forces that shape opportunities and pose threats to the company Uncontrollable factors and success depends on its adaptability Also known as general or remote environment

    Factors in Macro Environment

    Factors included in macro environment are:


    Economic

    environment Political or regulatory/legal environment Social/cultural environment Technological environment Natural environment Global environment

    Micro Environment
    Known as task or operating environment as it directly affect operations It includes co.s immediate environment affecting performance of the firm Micro factors need not necessarily affect all the firms in an industry in the same way

    Factors in Micro Environment Supplier Customers Competitors Marketing intermediaries Financiers publics

    suppliers

    These are the intermediaries who provides the raw material and components to the company. Because the timely production depends on them. Honda Activa.. If these services are not there than company have to block its lot of money into inventories.

    customers

    The major task of any business is to retain the existing customer and find out the new customer. The company is having diff. type of customer like individual, household, industry and government. The task of the company here is to satisfy its customer by price, quality and service. Co. also do by the way of providing the innovation into existing product.

    Competitors

    The competitors may be from the same industry who sells the similar product. E.g. L.G. and ONIDA, The competitors can be the company who fights for the market share. Competition may be to create brand loyalty. Competition may be from new entry also.

    Marketing intermediaries

    In includes the wholesaler, retailer, distributors, agent. Who help the company in finding out the new customer. These are the people who make it possible to reach the companys product into customer hand. Marketing agencies and transportation firms help the company in these.

    financieries

    These are the crucial factors which provides the finance to the business firm. At times to cover up losses incurred by the business these group provide the finance to the business. It enhances the profitability of the firm It also help the firm for tax planning.

    Society/people

    These the group which is having the interest or who has the capabilities to create interest for the company. Media people positive or negative Citizens of the country.

    Internal Environment

    Factors in Internal Environment


    Value

    system Mission and objectives Management structure and nature

    Human

    resources Company image and brand equity Others


    Physical

    assets and facilities R&D and technological capabilities Marketing resources Financial

    Value system:

    Value system: The value system of founder, or by the pioneer have a crucial impact on Mission, vision statement, business policy and practice. The extent to which the employee bound by the value are contributing to the success of the firm. Each firms value reflect in its mission statement.

    EXAMPLE
    Dabur Dedicated to the health & well being of every household. Coca Cola A coke is in arms reach of any customers no matter where that customer is around the world. Micro Soft Corp. A computer on every desk & in every home, using great software as an empowering tool.

    MANAGEMENT STRUCTURE

    Management structure consist of the employee at various level of the organization, Starting from board of directors to the lower level manager all are part of management. Two kinds of structure are there traditional structure where most of the decision taken by upper level person and that delays the decision. Another one is flat structure which induce the employee to take initiatives without further delay.

    INTERNAL POWER RELATION


    Amount of support from top management. Influence of the decision taken by the board of directors and implementation of it. The relation between board of directors. Relation of the employee at different level of organization.

    HUMAN RESOURCE

    Skill, quality, morale, commitment of the people. Ability of the employee to cope up with change. The remuneration provided to the employee. The welfare activities like food, clothing, cleanliness at work place. Promotion and performance appraisal.

    COMPANY IMAGE AND BRAND EQUITY

    The IMAGE OF THE COMPANY IN THE MARKET. McDonalds should be the leading provider of moderately priced, quality food to anyone, anywhere. It matters when the company want to merge with someone or want to acquire new company. At times to get timely supply from the suppliers and to have the resources on credit. At times of timely payment of debt. At the time of having money from the shareholders.

    Miscellaneous factors

    Physical assets Research and development Marketing activity Financial stability

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