internal and external factors of business environment pdf

Internal and external factors of business environment pdf

File Name: internal and external factors of business environment .zip
Size: 10142Kb
Published: 11.04.2021

External Factors

US & World

What Are Internal & External Environmental Factors That Affect Business?

What Are Internal & External Environmental Factors That Affect Business

The formula for business success requires two elements - the individual and the environment. Remove either value and success becomes impossible. Business environment consist of all those factors that have a bearing on the business. The term 'business environment implies those external forces, factors and institutions that are beyond the control of individual business organisations and their management and affect the business enterprise.

External Factors

The formula for business success requires two elements - the individual and the environment. Remove either value and success becomes impossible. Business environment consist of all those factors that have a bearing on the business. The term 'business environment implies those external forces, factors and institutions that are beyond the control of individual business organisations and their management and affect the business enterprise.

It implies all external forces within which a business enterprise operates. Business environment influence the functioning of the business system. Thus, business environment may be defined as all those conditions and forces which are external to the business and are beyond the individual business unit, but it operates within it. These forces are customer, creditors, competitors, government, socio-cultural organisations, political parties national and international organisations etc.

Specific forces affect individual enterprises directly and immediately in their day-to-day working. General forces have impact on all business enterprises and thus may affect an individual firm only indirectly. Similarly, demand for sarees may be fairly high in India whereas it may be almost non-existent in France. On the basis of the extent of intimacy with the firm , the environmental factors may be classified into different types-internal and external.

The internal environment is the environment that has a direct impact on the business. Here there are some internal factors which are generally controllable because the company has control over these factors. It can alter or modify such factors as its personnel, physical facilities, and organization and functional means, like marketing, to suit the environment.

The important internal factors which have a bearing on the strategy and other decisions of internal organization are discussed below. The value system of the founders and those at the helm of affairs has important bearing on the choice of business, the mission and the objectives of the organization, business policies and practices. Vision means the ability to think about the future with imagination and wisdom. Vision is an important factor in achieving the objectives of the organization.

The mission is the medium through which the objectives are achieved. Management structure and nature. The structure of the organization also influences the business decisions. The organizational structure like the composition of board of directors , influences the decisions of business as they are internal factors.

The structure and style of the organization may delay a decision making or some other helps in making quick decisions. The relationship among the three levels of the organization also influences on the business. The mutual co-ordination among those three is a an important need for a business. The relationship among the people working in the three levels of the organization should be cordial.

The human resource is the important factor for any organization as it contributes to the strength and weakness of any organization. T he involvement and initiative of the people in an organization at different levels may vary from organization to organization. The organizational culture and overall environment have bearing on them.

The image of the company in the outside market has the impact on the internal environment of the company. It helps in raising the finance , making joint ventures , other alliances, expansions and acquisitions , entering sale and purchase contracts , launching new products, etc.

Brand equity also helps the company in same way. Miscellaneous factors. The proper working of the assets is indeed for free flow of working of the company. It refers to the environment that has an indirect influence on the business. The factors are uncontrollable by the business. There are two types of external environment. The micro environment is also known as the task environment and operating environment because the micro environmental forces have a direct bearing on the operations of the firm.

The micro environmental factors are more intimately linked with the company than the macro factors. The micro forces need not necessarily affect all the firms in a particular industry in the same way.

Some of the micro factors may be particular to a firm. When the competing firms in an industry have the same micro elements, the relative success of the firms depends on their relative effectiveness in dealing with these elements.

An important force in the micro environment of a company is the suppliers, i. The major task of a business is to create and sustain customers. A business exists only because of its customers. The choice of customer segments should be made by considering a number of factors including the relative profitability, dependability, stability of demand, growth prospects and the extent of competition.

Competition 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. The competition that satisfies a particular category desire then it is called generic competition..

Marketing Intermediaries. The marketing 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.

The financiers are also important factors of internal environment. Along with financing capabilities of the company their policies and strategies, attitudes towards risk , ability to provide non-financial assistance etc. Public include media and citizens.

Growth of consumer public is an important development affecting business. 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. Some of the macro environment factors are discussed below:. Economic environment refers to the aggregate of the nature of economic system of the country, business cycles, the socio-economic infrastructure etc.

The social dimension or environment of a nation determines the value system of the society which, in turn affects the functioning of the business. Sociological factors such as costs structure, customs and conventions, mobility of labour etc.

These factors determine the work culture and mobility of labour, work groups etc. The political environment of a country is influenced by the political organisations such as philosophy of political parties, ideology of government or party in power, nature and extent of bureaucracy influence of primary groups etc.

The political environment of the country influences the business to a great extent. Legal environment includes flexibility and adaptability of law and other legal rules governing the business. It may include the exact rulings and decision of the courts. These affect the business and its managers to a great extent. The business in a country is greatly influenced by the technological development. The technology adopted by the industries determines the type and quality of goods and services to be produced and the type and quality of plant and equipment to be used.

Technological environment influences the business in terms of investment in technology, consistent application of technology and the effects of technology on markets. Open navigation menu. Close suggestions Search Search. User Settings. Skip carousel. Carousel Previous. Carousel Next. What is Scribd? Uploaded by Mohammad RIzwan. Date uploaded Dec 23, Did you find this document useful?

Is this content inappropriate? Report this Document. Description: Easy and Helpful for your Project Works. Flag for inappropriate content. Download now. Internal and External Business Environment. Related titles. Carousel Previous Carousel Next. External Industrial Environment Analysis for Singapore airline. Internal and External Factors of Business Environment. Jump to Page. Search inside document. Value system The value system of the founders and those at the helm of affairs has important bearing on the choice of business, the mission and the objectives of the organization, business policies and practices.

Mission and vision and objectives Vision means the ability to think about the future with imagination and wisdom. Management structure and nature The structure of the organization also influences the business decisions.

Internal power relationships The relationship among the three levels of the organization also influences on the business. Human resource The human resource is the important factor for any organization as it contributes to the strength and weakness of any organization.

US & World

To browse Academia. Skip to main content. By using our site, you agree to our collection of information through the use of cookies. To learn more, view our Privacy Policy. Log In Sign Up. Download Free PDF. Download PDF.

FutureLearn uses cookies to enhance your experience of the website. All but strictly necessary cookies are currently disabled for this browser. Turn on JavaScript to exercise your cookie preferences for all non-essential cookies. You can read FutureLearn's Cookie policy here. Category: Current Issues , General. Category: Current Issues , Entrepreneurship. Category: Current Issues.

The impact of external and internal factors on organization of operation at company level is studied. The necessity for implementing strategic management of innovation processes at company level is substantiated. The structural interactions of external and internal factors on the organization of company operation are determined; a classification of factors of external and internal environment in the context of strategic management of innovation processes at company level is constructed. Dykan V. Strategic management.


Competition from other.


What Are Internal & External Environmental Factors That Affect Business?

Businesses do not operate in a vacuum, and they are influenced by forces beyond their control. The economic environment of business has changed dramatically in recent years. After decades of growth and dominance, the U. Since the financial crisis in , the U.

Slideshare uses cookies to improve functionality and performance, and to provide you with relevant advertising. If you continue browsing the site, you agree to the use of cookies on this website. See our User Agreement and Privacy Policy.

IDENTIFICATION OF INTERNAL AND EXTERNAL FACTORS AFFECTING BUSINESS EXCELLENCE

A business is impacted by the different factors from the environment continuously. We can divide this environment into two ways one internal environment factors and other external environmental factors.

What Are Internal & External Environmental Factors That Affect Business

Our website is made possible by displaying online advertisements to our visitors. Please consider supporting us by disabling your ad blocker. Mastering some of the forces that impact your business is more challenging than handling others. The extent to which you can control them differs.

A business concept that looks perfect on paper may prove imperfect in the real world. Sometimes failure is due to the internal environment — the company's finances, personnel or equipment. Sometimes it's the environment surrounding the company. Knowing how internal and external environmental factors affect your company can help your business thrive. In a bad economy, even a well-run business may not be able to survive. If customers lose their jobs or take jobs that can barely support them, they'll spend less on sports, recreation, gifts, luxury goods and new cars. High interest rates on credit cards can discourage customers from spending.

If a business wants to be successful in the marketplace , it is necessary for them to fully understand what factors exert impact on the development of their company. Once they know about both positive and negative effects within and outside the company, they can produce suitable strategies to handle any predicted situation. Therefore, examining internal and external factors is considered the most important task for an enterprise before launch any strategic marketing plan.

Our purpose is to transform access to education.

И это вопрос национальной безопасности. Беккер вошел в телефонную будку и начал набирать номер Стратмора. Не успел он набрать международный код, как в трубке раздался записанный на пленку голос: Todos los circuitos estan ocupados - Пожалуйста, положите трубку и перезвоните позднее. Беккер нахмурился и положил трубку на рычаг. Он совсем забыл: звонок за границу из Испании - все равно что игра в рулетку, все зависит от времени суток и удачи.

1 comments

  • Maddison P. 14.04.2021 at 06:42

    Employees and Managers.

    Reply

Leave a reply