THE FIRM & ITS ENVIRONMENT Flashcards
INCLUDE FACTORS/ELEMENTS SUCH AS INFLATION, RATES OF INTEREST, CHANGING OPTIONS IN STOCK MARKETS AND PEOPLE’S SPENDING HABITS.
ECONOMIC
INCLUDE THE CUSTOMERS’ CHANGING VALUES AND PREFERENCES
SOCIOCULTURAL
REFER TO NATIONAL OR LOCAL LAWS, INTERNATIONAL LAWS AND RULES AND REGULATIONS THAT INFLUENCE ORGANIZATIONAL MANAGEMENT.
POLITICO-LEGAL
GENDER, AGE, EDUCATIONAL LEVEL, INCOME, THE NUMBER OF FAMILY MEMBERS, GEOGRAPHIC ORIGIN, ETC. MAY ALSO INFLUENCE SOME MANAGERIAL DECISIONS IN ORGANIZATIONS.
DEMOGRAPHIC
COMPANIES INVOLVE THE USE OF VARIED TYPES OF ELECTRONIC GADGETS AND ADVANCED TECHNOLOGY SUCH AS COMPUTERS, ROBOTICS, MICROPROCESSORS, ETC.
TECHNOLOGICAL
RELATED TO INCREASING NUMBER OF GLOBAL COMPETITORS AND MARKETS, AS WELL AS THE NATURE AND CONDITIONS OF THE CHANGING NATURAL ENVIRONMENT.
WORLD AND ECOLOGICAL
Parties likely to be affected by the activities of the organization while customers are those who patronize the organization’s products and services.
Stakeholders
Those who ensure the organization’s continuous flow of needed reasonably priced inputs or materials required for producing their goods and rendering their services.
Suppliers
Special-interest groups that try to influence the organization’s decisions or actions.
Pressure groups
Provide the company with the financial support it needs.
Investors or owners
Those who work for an employer in exchange for salaries/wages or non-monetary benefits.
Employees
A widely used tool to identify the external forces that may affect an organization both positively and negatively.
PESTEL Analysis
These factors determine the IMPACT of government and government policy on a particular organization or a specific industry. It includes trade, fiscal, and taxation policies, among others.
Political
These factors determine the IMPACT of the economy and its performance to an organization and its profitability. These include interest rates, employment or unemployment rates, raw material costs, and foreign exchange rates, among others.
Economic
These factors determine the IMPACT of the social environment and emerging trends to the business profitability of an organization. These include changing family demographics, education levels, cultural trends, attitude changes, and changes in lifestyles, among others.
Social
These factors determine the IMPACT of technological innovation and development on a particular market or industry. These include changes in digital or mobile technology, automation, research, and development.
Technological
These factors determine influence of the surrounding environment and the impact of ecological aspects to a market or industry. These include climate, recycling procedures, carbon footprint, waste disposal, and sustainability.
Environmental
These factors determine the importance of understanding legal laws and procedures on a given territory where a business operates. These include employment legislation, consumer law, health, and safety, international as well as trade regulation and restrictions.
Legal
A method of predicting how variable in the environment will alter the future of business.
Business predictions or business forecasting
Defined as the process of measuring or comparing one’s products, services, and practices with those of the recognized industry leaders to identify ares for improvement.
Benchmarking