chapter 1 internal external env
TRANSCRIPT
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Macro Environment = General/Remote
Environment
The macro forces are generally moreuncontrollablethan micro environment.
Success of an organization depends uponits adaptability to the environment.
Exampleof cost of imported component
going up because of depreciation of the
domestic currency, solution may lie with
domestic manufacture of the component.
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THE MACRO ENVIRONMENT
The far or macro environment relates to:
Political Economic Global Environment
Socio-CulturalTechnologicalEnvironmentalLegal
These influences may impact your business,
now or in the future.
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Political influences relate to government or
constitutional policies that may affect yourbusiness.For example, potential government
legislation may allow businesses to registerthat they do not want to receive unsolicitedcalls. This may restrict cold calling on abusiness to business basis.
The expansion of EU boundariesmayhave an impact on certain businesses.
E i
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Economic
Economic influences relate to the economy as a whole.
Rates of interesthave an impact for example onlevels of borrowing.
The strength of the stock markethas an impact ontypes of investment made.
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Socio-cultural
class age gender demographics
issues such as culture-both local & international diversity.
For example drinkinghabitsof people in
France are differentto those in the UK.
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TECHNOLOGICAL
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use of the internet.
advances in mobilephones.
Bluetooth.
wireless networks.
data management.
customer relationship
management systems.
Technological influences include
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TECHNOLOGICAL FACTORS
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Many businesses areimpacted today by
environmental issues.
Corporate socialresponsibility is now
higher on the public'sagenda.
Organizations such as
Shell and Nike havebeen affected byadverse publicityrelating to
environmental issues.
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Legal
Legal constraints also
affect businessperformance.
The Working TimeDirective, PaternityLeave and MinimumWage are examples ofthis.
In certain industriesthere are legalconstraints imposedbyregulatory or watchdog
bodies.
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The gaming industry is an example of one sector which has been
impacted by changes in the far external environment. Traditionally
betting shops such as William Hill have always been a 'horses and
dogs' business. As recently as 1999 this made up 80% of its
business. The proliferation of sports and topics that people can now
place bets on has led to huge changes in the world of
gambling. The twin forces of technology and deregulation have also
altered things. Gamblers can now place bets on the internet, via
interactive TV, on WAP-enabled mobile phones, via high street
shops or call centers. Bookmakers now open on Sundays and in the
evenings to cater for different work and leisure patterns. There are
proposals on the table to further modernize the gambling laws in this
country which relate back to 1960s license and regulate the industry.
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Microsoft Antitrust Case
The government viewed Microsoft as a paranoidmonopolist, someone who gets up in the middleof the night and shoots at any movement.
-Harry Edwards, Chief Judge, US District Court
for Appeals for the District of Columbia.
"The Sun was definitely shining in Seattle.Today's ruling really does go a long way toward
positively resolving this matter for Microsoft, forour customers, partners, and shareholders."-Steven Ballmer, CEO, Microsoft, commenting on
the US Court of Appeals for the District ofColumbia reversing the District Court ruling thatMicrosoft be broken into two companies.
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MICROSOFT - A MONOPOLY?
In the late 1990s, as Microsoft was preparing to enter the
new millennium, the company was fighting the anti-trustproceedings initiated against it by the US government.One of the main charges against Microsoft was that itwas distributing its Internet browser software, InternetExplorer (IE), free of cost along with its WindowsOperating System. Microsoft was a late entrant into the
Internet software market. Subsequently, it adoptedaggressive marketing tactics to catch up with the earlyentrant, Netscape Communications.
Netscape protested against Microsoft's move calling it anattempt to shut out other software that competed on a
stand-alone basis. Another important charge againstMicrosoft was that it had modified Sun Microsystems'Java language in order to make it Windows compatible.
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Some analysts argued that the overwhelming marketshare that Microsoft held was a major impediment toinnovations in the software industry. Microsoft wasnot only a leading player, but also the standards
provider for the industry. By controlling thestandards, the company was in a position to curbinnovations. Microsoft, however, maintained that itsdominance of the market was due to its superiorproducts and not because of any unfair market
practices.
In 2000, the US Department of Justice (DOJ) ruledthat Microsoft be split into two smaller companies toprevent it from indulging in anti competitive
practices. However, in June 2001, the US Court ofAppeals reversed this ruling, but said that Microsoftdid have a monopoly in the market and had violatedUS antitrust laws. In August 2001, Microsoftappealed to the US Supreme Court to overturn theruling that Microsoft was an illegal monopoly. A final
verdict on the case was expected by October 2001.
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THE TRIAL BEGINS
In October 1997, the DOJ began antitrustinvestigations to determine whether Microsoft wasviolating a 1994 consent decree by compelling PCmakers to ship its Internet browser free with
Windows 95. Joel I. Klein, Assistant Attorney General for the
antitrust division, remarked, "This kind of product-forcing is an abuse of monopoly power--and we willseek to put an end to it." Justice Thomas Penfield
Jackson of the US District Court heard the case and,in May 1998, gave both the parties five months togather 12 witnesses each, and to fight the suit.
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?? Questions to Ponder ??