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Welcome to the Practical worldAnd real business environment.
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A Morninggg Prayer by a
businessman Hey bhagwan ! Please give me strength to pay income tax
, Vat, Cst, customs, Service tax, Excise duty, Tds, Pf,
professional tax, Road Tax, Stamp duty, Water tax,
Education Cess and Many More!
Besides that also give me additional strength to pay Hafta,
Chai panni , Donatioin, chanda and then if I have some
thing left then I can feed my family and then help the
society and mankind .
Also give me strength to fight my competitors, be good to
my employees and my suppliers & customers.
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It is not the strongest of the species thatsurvive , nor the most intelligent ., but theone most RESPONSIVE TO CHANGE.
Charles Darwin
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Business + Enviornment It means all thoseeconomic activities which
are carried for the purpose
of earning profits
(purchase, sale,
manufacture, services etc
).
The surrounding which
affects the activities and
operations of business.
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Basically business environment refers to all internal and
external factors which have a bearing on the functioning of
business
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Objectives of BusinessIt is the society Organ of economic expansion, growth & change as an individual
goes through a need cycle, on similar lines a business also moves on a cycle of
evolution.
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Business
Survival
Stability
Growth
Efficiency
Profitability
IndividualBasic needs
Safety needs
Social needs
Self estreem
needs
Selfactualisationneeds Pnemonics: S-PEGS
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Relationship between Business & Environment Mutual dependence
Creation of Utility
Regular contact
Provides means of production and information
Responsible to all the factors
Flexibility
Dynamic nature
Capable to influence the society ETC.
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Importance Of Business Environment Provide knowledge about internal enviornment
Knowledge about problems & complexities
To study the economic policies of the government
Optimum use of the resources
Study of market Cont!!!!!!!!!!!
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Importance Of Business Environment Long term business strategy
Development of science & technology
Taking advantages of opportunities
To understand international events and their impacts
Helps in forecasting
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Internal EnvironmentThere are no of Factors which influence thedecision making. They are:
ObjectivesThe strategy & future planning are
driven by its objectives.
Management-The quality of the board is a very criticalfactor for the Development & performance.
Human resource- It contribute to the strength &weakness of an organization.
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Internal EnvironmentOther Factors:
o Financial factor
o Marketing capabilities
o R & D
o Physical assets & Facilities
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External EnvironmentMicro
Macro
External
Enviornment
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It is related to small area or immediate
periphery of an organization.
Micro environment Influences an
organization regularly and directly.
It is also known as Operating environment
because It has direct bearing on the operation of
the firm.
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These may includes the followingelements :
{C}- Customer
{O}- Organization
{S}- supplier
{M}- Market
{I}- Industry
{C}- competitors
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0
100
200
300
400
500Social
Legal
EconomicalPolitical
Technological
Macro
Micro
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These consist the general environment , which affectsthe working of all the firms. It includes:
{S} Social{L} Legal
{E} Economical
{P} Political
{T} - Technological
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Environmental Influences
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It is the favorable
condition in the organization environment , which
enables it to consolidate and strengthen its position.Ex: Possibility to get into new area of business
Threat: It is an unfavorable condition in the
organization environment, which create a risk for,cause a damage to the organization.
Ex: Private players get together & take away theseopportunities {Bsnl 3G}
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Environmental InfluencesStrength : It is an inherent capacity, which an
organization can use to gain strategic advantages over
its competitors.Ex: Great network
Weakness: It is an inherent limitation which
create a strategic disadvantage over its competitors.Ex: Inefficient employees , casual attitude towardsthe work.
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It helps strategists buy time to anticipate opportunities
and to plan to take optional response to theseopportunities .strategy develops an EARLY WARNINGSYSTEM to prevent threat or to develop strategies whichcan turn a threat to firms advantage.
But it does not mean that Future can be
controlled But not also Totally negative.
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