Module 3 Flashcards
External Environment
environment outside the company that can take affect to the company. change, complexity, resource scarcity, general and specific environment’s all come into play in the external environment.
What is in the general environement
economy, technological, sociocultural trends, political/ legal
What is the general environment?
consists of the economy and the technological , socio-cultural, and political/legal trends that indirectly affect all organizations.
Economy
ü More is bought and sold in a growing economy than a shrinking one
ü With higher wages, people have more to spend
-Therefore all organizations are affected by the economy.
Technological
ü An umbrella term for the knowledge, tools, and techniques used to transform inputs (raw materials) into outputs (products and services)
–Changes in technology can help companies provide better products or produce their products more efficiently.
Sociocultural trends
ü Refers to demographic characteristics, general behaviour, attitudes, and beliefs of people in a particular society.
ü Sociocultural changes and trends influence organizations in two ways
1. Changes in demographic characteristics, such as the number of role with particular skills, the growth or decline in particular populations segments, evolving cultural norms affect how companies staff their businesses.
2. Changes in behavior attitudes and beliefs affect hte demand for business products and services.
political/legal
Laws , regulations and t decisions that govern and regulate business behaviour.
What affects the specific environment?
customers, competitor’s, supplier’s, industry regulations, advocacy group’s
Customer’s
ü Monitor customers
1. Reactive customer monitoring involves identifying and addressing customer treads and problems after they occur. 2. Proactive monitoring - identifying and addressing customer needs, trends, and issues before they occur.
Competitor’s
ü Companies that sell similar produces or services to customers.
–Competitive analysis- which involves deciding who your competitors are, anticipating their moves, and determining their strengths and weaknesses.
Supplier’s
ü Companies that provide material, human finaical and information resources to other companies. A key factor influencing the impact and quality of the relationship between companies and their suppliers is how interdependent they are
§ Supplier dependences- refers to the degree to which a company relies on a give supplier because of the importance of its product to the company and the difficulty of finding other sources for that products.
§ Buyer dependence- is the degree to which a supplier relies on a buyer because of the importance of that buyer to the supplier’s sales and the difficult of finding other buyers for its products.
§ Opportunistic behaviour- in which one party benefits at the expense of the other.
-Relationship behaviour - focuses on establishing mutually beneficial, long-term relations between buyers and suppliers.
Industry Regulation’s
ü Consists of regulations and rules that govern the practices and procedures of specific industries, businesses, and professions.
-Regulatory agencies affect businesses by creating and enforcing rules and regulations to protect consumers, workers, and society as a whole.
Advocacy Group’s
ü Concerned citizens who band together to influence the business practices of specific industries, businesses, and professions.
stable environement
the rate of environmental change is slow (bread)
dynamic enviornment
the rate of environment change is fast (RIM/blackberry)
