Explain how variables from the business environment may influence the operations of the organisation

Besides, it is the indicator of the efficiency of the business firm.

types of business environment

In public enterprises, the government of the country is the owner. They also need to understand the influences of changes in the industry environment. The trends on most business performances dropped during this period and Burberry experienced a low just like any other business.

Business environment factors

Even Government organizations and departments Public Sector Units are not exempted from the purview of the punishment. Indian population is highly heterogeneous with varied religions, languages, castes and creeds. Rapid industrialization has drastically damaged the quality of our natural environment. This environment poses a serious challenge to the business, and the business managers while formulating business strategies and policies should give due weight to this pivotal factor. Positive economy condition can be favorable for business development and adverse ones may generate negative consequences such as narrow down business scale, capital shortage or even bankrupt. Owners of an organization may be an individual in the case of sole proprietorship business, partners in a partnership firm, shareholders or stockholders in a limited company or members in a cooperative society. Thus, managers are primarily adapters to, rather than agents of, change. The social changes in life also lead to new fashion trends that affect business in any part of the economy.

Besides, it also acts as a competitor and as a customer. Your staff will infer your values based on the type of people you hire, fire and promote.

Political and Legal Environment Economic environment within a country is closely linked with the political and legal environment there.

Explain how variables from the business environment may influence the operations of the organisation

The population is becoming increasingly diverse: currently minorities represent more than 38 percent of the total U. Technological environment Technological factors affects business concerning technological investment, technological application and the effect of technology on markets. All these factors make the personnel management a risky and difficult job. Understanding Economic Systems and Business 3 Understanding the Business Environment What are the sectors of the business environment, and how do changes in them influence business decisions? Nevertheless, training of staff is an essential aspect of good business management, and even in difficult financial circumstances is an achievable strategy. In addition, there is price and distribution control over a number of commodities. Even in South India, people in different states may not have similar tastes, likes etc. By the U. The labour force is also highly heterogeneous in many respects. If a priority sector industry is started in a backward area, it can avail both the benefits available to priority sector as well as those meant for backward areas. The impact of this environment is much more direct and deliberate than other factors.

Global competition is basically an uncontrollable element in the external environment. If equipment is in short supply or not of the expected standard, then staff may be hindered in the performance of their duties, or if equipment is used by customers then customer satisfaction will fall.

The impact of this environment is much more direct and deliberate than other factors.

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What Are Internal & External Environmental Factors That Affect Business?