(chapter 1) Influences and challenges of the business environments Flashcards
Reasons why the business has full control over the micro environment
• Business owners and managers have a great deal of control over the internal/micro environment of business, which covers day-to-day decisions.
• They choose the suppliers they purchase from/which employees they hire/the products they sell, and where they sell those products.
• They use their skills and resources to create goods and services that will satisfy existing and prospective customers.
Reasons why the business has little control over the market environment
• Market environment for a business includes company related influences
• The market environment refers to influences that have an impact on the success in forming and keeping a sustainable business such as competition and suppliers.
• Businesses can influence their competitors by increasing the quality of their products in relation with competitor prices.
• The opposite can also be that suppliers’ raw materials can influence the quality of business products.
Reasons why the business has no control over the macro environment
• The macro environment refers to the major external and uncontrollable factors that influence an organisation’s decision making.
• These factors include the economic/demographics/legal/political/social conditions/ technological changes and natural forces.
• The above mentioned factors affect business performance and strategies.
• The external environmental conditions that affect a business are generally beyond the control of management and change constantly.
Ways in which businesses can be involved in the macro environment
• Influencing suppliers by signing long term contracts.
• Influencing regulators through lobbying and bargaining.
• Knowing goverment regulations and operating within them.
• Keeping up with new technologies to improve production and marketing.
• Lowering its impact on the environment.
• Working within the law to set up contracts.
Benefits/advantages of involvement in the macro environment
• The business can contribute to a healthier, more skilled and productive workforce.
• it can protect natural resources and meet consumer needs in a sustainable way.
• The business can contribute to wealthier consumers.
• Reduced industrial conflict and increase productivity.
• The business can accurately promote a cause that is a concern to the society
Difficult employees
• Difficult employees may have a negative attitude on new employees.
• They need a lot of supervision to complete their tasks satisfactory.
• They need lot of scandi hao come enter image life say negative things about the
business.
Lack of vision and mission statement
• Lack of vision and mission statement will hamper meaningful guidance and leadership to employees.
• When there is no mission the business will lack focus/direction and a single long term objective.
Lack of adequate managerial skills
Lack of adequate managerial skills will result in the business not achieving its objectives.
: Managers may obe able to provide meaningful guidance and leadership to employees
• Managers have different styles of managing and leading and this can be the source of enormous conflict with other managers and with staff.
• Ineffective management can affect the productivity and profitability of a business.
The impact of unions
Trade unions may create tension between management and employees.
Businesses may not be able to meet the demands of the trade unions.
• Once employees have a grievance against their employers relating to payments/workers* rights/work conditions they will declare an industrial dispute.
Strikes and go-slows
Strikes and go-slows may affect the business negatively as it cannot meet its expected units of production.
Employees may not report to work due to a complete shutdown strike.
Employees may report to work but work slowly so that the business cannot meet its targets due to go slows.
