Business Environment Harsh Jain

7/31/2019 Business Environment Harsh Jain

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Welcome to the Practical worldAnd real business environment.

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A Morninggg Prayer by a

businessman Hey bhagwan ! Please give me strength to pay income tax

, Vat, Cst, customs, Service tax, Excise duty, Tds, Pf,

professional tax, Road Tax, Stamp duty, Water tax,

Education Cess and Many More!

Besides that also give me additional strength to pay Hafta,

Chai panni , Donatioin, chanda and then if I have some

thing left then I can feed my family and then help the

society and mankind .

Also give me strength to fight my competitors, be good to

my employees and my suppliers & customers.

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It is not the strongest of the species thatsurvive , nor the most intelligent ., but theone most RESPONSIVE TO CHANGE.

Charles Darwin

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Business + Enviornment It means all thoseeconomic activities which

are carried for the purpose

of earning profits

(purchase, sale,

manufacture, services etc

).

The surrounding which

affects the activities and

operations of business.

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Basically business environment refers to all internal and

external factors which have a bearing on the functioning of

business


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Objectives of BusinessIt is the society Organ of economic expansion, growth & change as an individual

goes through a need cycle, on similar lines a business also moves on a cycle of

evolution.

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Business

Survival

Stability

Growth

Efficiency

Profitability

IndividualBasic needs

Safety needs

Social needs

Self estreem

needs

Selfactualisationneeds Pnemonics: S-PEGS


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Relationship between Business & Environment Mutual dependence

Creation of Utility

Regular contact

Provides means of production and information

Responsible to all the factors

Flexibility

Dynamic nature

Capable to influence the society ETC.

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Importance Of Business Environment Provide knowledge about internal enviornment

Knowledge about problems & complexities

To study the economic policies of the government

Optimum use of the resources

Study of market Cont!!!!!!!!!!!

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Importance Of Business Environment Long term business strategy

Development of science & technology

Taking advantages of opportunities

To understand international events and their impacts

Helps in forecasting

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Internal EnvironmentThere are no of Factors which influence thedecision making. They are:

ObjectivesThe strategy & future planning are

driven by its objectives.

Management-The quality of the board is a very criticalfactor for the Development & performance.

Human resource- It contribute to the strength &weakness of an organization.

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Internal EnvironmentOther Factors:

o Financial factor

o Marketing capabilities

o R & D

o Physical assets & Facilities

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External EnvironmentMicro

Macro

External

Enviornment

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It is related to small area or immediate

periphery of an organization.

Micro environment Influences an

organization regularly and directly.

It is also known as Operating environment

because It has direct bearing on the operation of

the firm.

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These may includes the followingelements :

{C}- Customer

{O}- Organization

{S}- supplier

{M}- Market

{I}- Industry

{C}- competitors

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15

0

100

200

300

400

500Social

Legal

EconomicalPolitical

Technological

Macro

Micro


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These consist the general environment , which affectsthe working of all the firms. It includes:

{S} Social{L} Legal

{E} Economical

{P} Political

{T} - Technological

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Environmental Influences

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It is the favorable

condition in the organization environment , which

enables it to consolidate and strengthen its position.Ex: Possibility to get into new area of business

Threat: It is an unfavorable condition in the

organization environment, which create a risk for,cause a damage to the organization.

Ex: Private players get together & take away theseopportunities {Bsnl 3G}


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Environmental InfluencesStrength : It is an inherent capacity, which an

organization can use to gain strategic advantages over

its competitors.Ex: Great network

Weakness: It is an inherent limitation which

create a strategic disadvantage over its competitors.Ex: Inefficient employees , casual attitude towardsthe work.

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It helps strategists buy time to anticipate opportunities

and to plan to take optional response to theseopportunities .strategy develops an EARLY WARNINGSYSTEM to prevent threat or to develop strategies whichcan turn a threat to firms advantage.

But it does not mean that Future can be

controlled But not also Totally negative.

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Business Environment Harsh Jain

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