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Higher Business > Internal and External Influences > Flashcards

Internal and External Influences Flashcards

1
Q

what are internal factors?

A

different situations that occur within the business which impacts the success of the company.

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2
Q

who have control over internal factors?

A
  • owners
  • mangers
  • employees
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3
Q

what are the 4 internal factors?

A
  1. Finance
  2. Staff (HR)
  3. Technology
  4. Corporate culture
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4
Q

organisations need finance to do what?

A

achieve their objectives

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5
Q

if a business is not well financed, what problems can occur?

A
  • not enough money to be able to pay for new systems and keep them up-to-date to improve the efficiency of the business.
  • Cannot offer wage rises to motivate staff
  • May not be able to follow expansion plans such as opening new stores
  • drastic action may be neededDRASTIC ACTION MAY BE NEEDED i.e. closing shops
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6
Q

how can employees (staff) impact a business?

A
  • must have the right experience and skills to be able to do the job efficiently
  • High quality training to ensure employees do their job properly
  • Employee impact on the quality of customer experience
  • moral of the workforce is crucialMORALE OF THE WORK FORCE IS CRUCIAL
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7
Q

how can employees (management) impact a business?

A
  • Should have experienced and be skilled in making effective decisions
  • Mind your level of risk - when making decisions can negatively impact a business.
  • Leadership skills of a manager contributes to the culture of the organisation
  • good managerial leadership -can also motivate the team to success
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8
Q

why must a businesses technology be modern?

A

so they don’t fall behind competition

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9
Q

how can technology have an impact on the business?

A
  • INCOME - production will stop and for that time there will be no income.
  • STAFF MORALE - if technology takes over jobs this can effect motivation.
  • IF THE BUSINESS DOES NOT KEEP UP WITH NEW TECHNOLOGY THEY WILL BE LEFT BEHIND THE COMPETITION.
  • DECISIONS REGARDING TECHNOLOGY MAY BE RESTICTED BY AVALIABILITY OF FINANCE.
  • TECHNOLOGY HAS A HIGH FINANCIAL COST AND USUALLY A SHORT SHELF LIFE.
  • STAFF MUST BE TRAINED TO USE ALL TECHNOLOGY.
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10
Q

what is corporate culture?

A

this is a set of values and beliefs that is shared by all people within the organisation.

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11
Q

corporate culture includes?

A
  • COMPANY VALUES - usually developed by the ‘founder’ outlines what the company stands for and is usually mentioned in the business statement.
  • OFFICE LAYOUT- consistent and relaxed layout of workplace generates a pleasant and productive working environment.
  • CORPORATE CULTURE - gives a strong corporate identify which is clearly recognisable.
  • STORE LAYOUT - consistent layout of all stores makes it easier for all customers and employees to adapt wherever they visit.
  • BUSINESS JARGON - an organisation invents its own words that can only be related back to that business.
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12
Q

what is reward culture?

A

things such as bonuses, commission, pay rises, awards and promotions encourages them to perform well.

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13
Q

what are advantages of corporate culture?

A
  • motivate staff
  • staff work when they are most productive
  • lights work environment
  • staff feel a belonging to the business
  • better relations between employees and management
  • staff turnover is reduced
  • Customers get a good feeling and want to experience the culture
  • High quality staff attracted
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14
Q

what are the disadvantages of corporate culture?

A
  • culture is hard to introduce unless start from the foundersCULTURE IS HARD TO INTRODUCE UNLESS IT STARTS ROM THE FOUNDERS.
  • Staff have to be made aware of changes to culture and if they arent, they may resist
  • Virgin office culture can leave someone please physically and socially distance which demotivates them
  • some cultures can be seen as a bribe to get staff on board.
  • management can lose focus and control of culture is loose.
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15
Q

P - political

can kind of governments can have an influence on businesses?

A

local and national

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16
Q

how to politics have an impact on businesses?

A

politics have a impact on the economy as a whole.
impacts could include:
- CHANGES TO LAW - health and safety (PPE)
- NEW LEGISLATION - minimum wage
- ALTERATIONS TO FISCAL POLICIES - change to tax rates which ca affect public spending.
- GOVERNMENT TARGETS - recycling

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17
Q

what are positive political impacts?

changes to the law

A
  1. BUSINESS ADHERE TO NEW REGISTRATIONS AD CHANGES IN THE LAW, THIS CAN ALLOW BUSINESS IN A POSITIVE LIGHT AND ATTRACT CUSTOMERS.
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18
Q

what are positive political impacts?

changes to tax rate

A

The government was to reduce taxes such as income tax this would result in customers having more disposable income and are likely to buy from the business

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19
Q

what are positive political impacts?

changes to VAT rates

A
  • the government could lower the VAT this would make products more affordable resulting in more sales.
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20
Q

what are negative political impacts?

changes to laws

A
  • changes to law such as the minimum age and health and safety can result in businesses having increased costs.
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21
Q

what are negative political impacts?

changes to tax rate

A
  • if taxes were to increase this would have the opposite effect. customers will have less money to spend which results in less sales for the business
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22
Q

what are negative political impacts?

changes to VAT rate

A
  • the government could make VAT-making products more expensive which results in less sales for the business.
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23
Q

E -Economic

what do economic influences refer to?

A

anything the encourages people to spend or not to spend or not to spend money due to the state of the economy.

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24
Q

what happens when the economy is doing well?

A

business produces more products which creates more jobs which then lead to people having more money to spend in other business.

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25
Q

what are the positive economic impacts?

boom period

A
  • demand is high businesses can take advantage of the demand by increasing places which will increase profits.
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26
Q

what are the positive economic impacts?

recession

A

unemployment is high so demand falls. business can take advantage of low credit and interest rates charged during this time.

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27
Q

what are the positive economic impacts?

recovery

A

sales will increase as more employment and spending. businesses can develop new products and start to raise prices.

28
Q

what are the negative economic impacts?

boom

A

a side effect of this inflation, when a rise in prices leads to wage rises so people can afford to keep up with prices. vicious cycle

29
Q

what are the negative economic impacts?

recession

A

may need to make staff redundant to survive. prices can be decreased to encouraged sales, but profits will fall.

30
Q

what are the negative economic impacts?

recovery

A

may find it hard to recruit new employees if the business gained negative publicity from previous redundancies.

31
Q

what is the economic policy?

A

it is the role of the government to try and control the economy through a number of measures

32
Q

what are the 2 sections the economic policy is split into?

A
  1. PASCAL POLICY - setting tax rates

2. MONETARY POLICY - ways in which it controls the supply of money into the economy by varying the interest rates.

33
Q

what do social factors concern with?

A

the ways in which society changes and the need for businesses to adapt in the same way.

34
Q

what can social factors involve?

A

changes in the demographics, characteristics or culture of population, what consumers buy and when.

35
Q

what happens if the business doesn’t change with its customers?

A

it risks losing sales to competitors

36
Q

what are examples of social factors?

A

demographic changes - ageing population - cater for all generations.
more women with professional careers - must offer working conditions to suit childcare.
- CHANGES IN SHOPPING HABITS - online shopping
- CHANGE IN TASTE AND FASHION
- LIFESYTLE CHANGES - health conscious, fitness]
- INCREASING CONCERNS FOR THE ENVIRONMENT
- SOCIAL ATTITUDES TOWARDS MATTERS SUCH AS LGBT AND RELIGION.

37
Q

what are the positive social impacts?

ageing population

A

people are living longer and a lot of people in the sector are retired and well off. Businesses in the sector are likely to succeed and charge higher prices.

38
Q

what are the positive social impacts?

more women withe professional careers

A

women tend to be older before they have their first child usually means they re better off by this point businesses can afford to charge higher prices.

39
Q

what are the positive social impacts?

evolving work life balance

A

fewer people are in 9-5 Monday-Friday jobs therefore society must care for these people e.g. 24 hour shops. rise in e-commerce. if they’re convenient fro customers they will return.

40
Q

what are the positive social impacts?

changing fashion trends

A

if businesses cater for current trends, they will be guaranteed sales. increase a fast fashion.

41
Q

what are the negative social impacts?

ageing population

A

market research and required can be extensive and time consuming

42
Q

what are the negative social impacts?

more women with professional careers

A

maternity leave - business must offer flexible working arrangements. recruitment and training are costly.

43
Q

what are the negative social impacts?

evolving work-life balance

A

organisations ave to provide and apply for more staff to operate during these hours.

44
Q

what are the negative social impacts?

changing fashion trends

A

research and development costs are high, and some items have short shelf life.

45
Q

businesses must adapt to meet societies views.

the ethical can include?

A
  • increase recycling
  • reduce packaging
  • rejecting the use of child labour in the supply chain
  • ensuring the treatment and health and safety standards of suppliers is of high standard
  • ensuring equality in the workplace
46
Q

what are technological factors?

and examples of these

A 
technological factors are the quickest evolving technological advancements tat can impact an organisation.
the increased use of:
- SOCIAL MEDIA 
- SMARTPHONES
- ORDER TRACKING 
- MOBILE PAY 
- E-COMMERCE
47
Q

what are positive technological impacts?

cloud computing

A

technology such as One Drive or Dropbox means organisation can save money on their own IT hardware.

48
Q

what are positive technological impacts?

social media

A

having a social media presence enables businesses to keep touch with customers, raise their profile, reach a worldwide market. some firms are also moving the customer service to social media.

49
Q

what are positive technological impacts?

WIFI/4G

A

4G can allow businesses to download and communicate information much faster and on the move. offering free wifi can attract customers.

50
Q

what are negative technological impacts?

cloud computing

A

heavy reliance on ‘the cloud’. if there is no internet connection the business cannot access files which can stop production. GDPR needs to be followed also.

51
Q

what are negative technological impacts?

social media

A

bad reviews can spread faster and easier via social media. can cause poor reputation and lose sales.

52
Q

what are negative technological impacts?

WIFI/4G

A

financial cost of setting up WIFI and maintaining it. not all areas are equipped for 4G.

53
Q

environmental factors can arise when?

A

either the ways in which the natural environments impacts organisations or the ways that organisations can impact the environment by acting in an ethical and environmentally friendly way.

54
Q

what do environmental factors include?

A
  • weather
  • Recycling
  • Pollution - carbon emissions
  • Ethical sourcing (supply chain)
  • Sourcing local produce
  • Reduced packaging
55
Q

what are positive environmental factor?

weather

A

please note businesses can be impacted by spells of favouritism weather.

56
Q

what are positive environmental factor?

recycling

A

organisations encourage recycling to impact less negatively on the environment and gain an environmentally friendly reputation.

57
Q

what are positive environmental factor?

carbon footprint

A

businesses who are utilising renewable energy and reducing their emissions will save money on fuel bills.

58
Q

what are negative environmental factor?

weather

A

adverse weather conditions can affect transport which can effect deliveries arriving. Staff may struggle to get to work which affect production. Damage can also be caused through flooding or strong winds where business may need to close until repaired.

59
Q

what are negative environmental factor?

recycling

A

recycling properly takes time, effort and money

60
Q

what are negative environmental factor?

carbon footprint

A

investing in renewable energy can be expensive

61
Q

what can businesses do to compete?

A
  • Alter prices to attract customers
  • bringing out and versions of product
  • launching new market campaigns
  • introduced customer service and support
62
Q

what are the positive effects of competition?

A
  • a competitor opening up a store next door can be positive as it provides choice for customers and can bring trade go the area.
  • competition improves a market as it brings new ideas and keep prices low.
63
Q

what are the negative effects of competition?

A
  • competition could undercut prices. to keep up, businesses may have to also reduce prices and reduce profit levels or lose customers to competition.
  • the competition can launch new products and keep up, businesses will have to spend money on researching and developing products of their own.
64
Q

what was the aim of the Competition and Marketing Authority?

A

to promote competition for the benefit of the consumers.

65
Q

what are the reasons for promoting competition?

A
  • prices are kept low
  • products and services are high quality
  • customer service is good
  • healthy market attracts foreign investment while creating jobs.
66
Q

what is the impact of the Competition and Marketing Authority?

A
  • organisations cannot participate in cartels (working together to fix prices)
  • the CMA can block mergers if its likely to lead to significant loss in competition for he marketplace.
  • organisations cannot use their positioning the marketplace to dominate pricing or supply of goods.
  • consumers are protected from unfair practises such as hidden charges.

Higher Business (44 decks)

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