Chapter One Flashcards
What are some of the components of the micro environment ?
Its is the :
Businesses mission and objectives
Mangement stucture
Bussiness Resources and culture
What are the components of the market environment ?
They are :
Suppliers
Costomers/consumers
Intermediaries
Competitors
Regulators
Strategic allies
Unions
What are the components of the marco enviroment? :
Physical enviroment
Environemental enviroment
Social/cutural/ Demographical environment
Technological environment
Legal/ political enviroment
Instiutional environment
Reasons why bussinesss has more control over the mirco environment ?
Bussineses have more control over micro environment because
- Able to choose their suppliers, which employees they hire, the products thye sell and where they sell them.
-Use skills and resources to create good and services that will satisfy costumers
-Owners/Managers have control over internal, which covers the day to day decsions
Why bussinesses have less control over market environment ?
Bussinesses have less control over market environment because :
-Suppliers raw materials can influence the quality of bussinesss products
-Bussiness’s influence their competitors, by increasing the quality of their products in relation to competitors
Why bussinesses have lesser control over macro environment ?
-Refers to major external and uncontrollable factors that influnence an organizations decision making
-Includes econcomic/demographics/legal/poiltical/social conditions/technological changes and natural changes.
-These factors affect bussines performance and strageties
What are ways in which bussinesses can be more involved in the macro environment ?
- Influencing suppliers to sign long term contracts
- Influencing regulators through lobbying and bargaining
-Having bargaining sessions between management and unions
-Lowering its impact on the environment
What are the benefits/Advantages of involvemnet in macro environment ?
-Reduce industrial conflict and increase productivity
-The business can contribute to wealthier costumers
-Promote a cause thats a concern to society
What are the challenges of the micro enviroment?
Difficult employees
Lack of vision and misson
Lack of adequate management skills
Unions
Strikes and go slows
High employee turnover
Employee absenteeism
Explaination of challanges in mirco environment :
Difficult employees :
-may have a negative attitude towards new employees.
Lack of vision and mission statement :
-will hamper meaningful guidance and leadership to employees
-If no mission, bussinesss will lack direction
Lack of adequate managerial skills :
-will result in bussinesses not achieving its objectives.
-Ineffective mangenment can affect the productivity and profitabiliy.
The impact of unions :
-Bussinesses may not be able to meet the demands of the trade unions
- may create tension betw mangement and employees
Differences between strikes and go slows :
Strike
-Temporary collective refusal of employees to work
-Workers will not be fired if they participate in a protected strike
Go-slow
-Workers will still carry on working, but at a slower pace
-Workers partucipating in go slow are often punished or fired
Skills shortages among employees :
-Some bussinesses hire people who are unqualified to do the job
-Unqualfied employees may contribute to bad decisons
High employee turnover :
-Means employess that resign frequenlty from bussiness
-affects productiviety and continity
Employee absentism :
-Employees absentieesm reduces productivity and profitabilty
What are the challenges of the market environment ?
Competition
Shortage of supply
Changes in consumer behaviour
Demographics and psychogrpahics
Socio-cultural factors
Explain what are the challenges of the market enviroment ?
Competition :
-Bussiness that sell simliar products pose a problem to the success of the bussiness.
-Dissaified customers will damnges the reptuation of bussiness and threathen future.
Shortage of supply :
-Bussinesses that suffer will shortage of supply will lose customers and may buy from other bussinesses
-Imported goods may not arrive as country of origin may have transport problems
Changes in consumer behaviour:
-Consumers are influenced by many factors and buying behaviour is unpredictable
-Prefences change as fashions and technology advnaces
Demographics and Psychographics
-Consumer attitudes, interests, opinions and lifestyle determine the characteristics of the consumer
-Difficult to determine because of the target market is always changing frequently.
Socio-cultural factors
-Socio-cultural factors describe the common behavioyr and attitudes of a
particular society
- Bussinesses must be aware about social trends and influencial campiagns to promote buying
-Challange is gathering information about changes and repsonding to them by adapting to practices
How can bussiness overcome competition in market enviroment ?
1) Improving on customer services and keeping customers happy
2) Selling products of supreior quality that customers might be intersted in
3) Charging lower prices that other bussiness
Challenges of the macro enviroment :
Change in income levels
Poltical changes
Contemporary legislation
Labour restrictions
Mirco lending
Globlisation
Social values and demographics
Socio economic levels
Demographics and psychographics difference :
Demographics
= Statistical data relating to population and particular groups within it. Age gender, occupation etc
Psychographics
= The classification of people according to their attuidues, asperations etc
