Business Environments Flashcards
List some aspects of the internal environment.
- Factors that directly influence the approach and the success of the operations inside the business
- Easier to manage than the external environment
- Have both negative and positive factors
What are some factors in the internal environment?
- Owner/s and managers
- Employees
- Organisational structure
- Organisational culture
How can we better manage owner/s and managers as an internal factor?
- A business needs to have an effective management team in order to succeed
- Leadership and management styles need to be appropriate to the business to
How can we better manage employees as an internal factor?
- They are the business’s most important asset
- Crucial to recruit and select the most appropriate employees for the business
- Vital to provide a working environment that maximises performance, motivation, job satisfaction and output
Define organisational structure.
A formal structure that outlines the roles and responsibilities of each member in the business
What is the optimal organisational structure for a business’s success?
- Highly structured organisations with efficient supervisors and strong communication lines positively influence and performance
Define organisational culture
- The shared values, beliefs, expectations, attitudes and behaviours of the people in the business
List some aspects of the external operating environment.
- Directly impact the operations of the business
- Consists of stakeholders outside of the internal structure of the business
Who are some of the stakeholders in the external operating environment?
- Customers
- Competitors
- Suppliers
- Interest groups
How can a business better manage customers as an external operating factor?
- A positive relationship must be established with customers as they provide revenue and certainty
- Establishment of a strong customer base, gaining loyalty from customers, continued building of relationships and encouraging more customers to create a competitive organisation.
- Effective customer service policies for a high level of customer satisfaction
Define competitor
A person or entity that offers competing products or services
How can a business better manage its competitors?
Consistent monitoring of competitors to see what they are doing and try to do it better
Define supplier
A person or organisation that provides a product or service
What does a business expect from its suppliers?
Need to be reliable and provide the necessary resources in a timely and cost-effective manner
How can a business better manage its suppliers as an external factor?
- Several suppliers are needed to stay competitive, allows for negotiation on prices
- Positive relationship with suppliers ensures possibility of new offers and good services
Define Interest Groups.
Organisations that share a common interest and desire to work together
What are the types of interest groups?
- Professional associations
- Trade unions
- Public interest groups
What is the function professional associations
Aid and support businesses and practitioners in an industry
What is the function of trade unions
Formed by workers in an industry to work for the common interest of its members and protect the rights of workers
What is the function of public interest groups
Focus on specific areas within an industry and attempt to influence specific policies
List some aspects of the macro external environment?
- Are the conditions of the whole environment, not just a specific industry
- A business has no control over these factors, however they impact on operations, decision making and performance
- The factors are referred to as STEEPLE
What does STEEPLE stand for?
- Socio-cultural
- Technological
- Economic
- Environmental
- Political
- Legal
- Ethical
