Environments+of+Business

 __ Environments of Business  __ We all know that managers are responsible for making a business operate more successfully. However in some cases there are factors that undermine any manager’s skill and ability. Managers do though; generally have control over the internal environment of the organisation, such as the staff, policies, buildings and facilities. They do not however necessarily have controls over the less predictable external environments, which consist of the operating environment and the macro (broad) environment. The Internal Environments Internal or micro environments are to some degree, controllable. These include; The Operating Environment The operating environment is made of factors external to an organisation that has a possible affect on the operation of the business. The Macro Environment The macro or broad environment is made up of external factors that are likely to have an indirect impact on the operation of the business the operation of business. The macro environment usually has an effect on one or more businesses. The macro environment includes; The state of the economy at present usually has a major impact on the business environment. The condition of the economy can be measured by;  ·  The inflation rate  ·  The level of unemployment  ·  Consumer confidence and consumer spending  ·  Interest rates  ·  Wage rates  ·  Business investments and business confidence  ·  Foreign exchange rates and the value of the Australian dollar Changes in technology are driving change at a global level. Businesses that fail to take account for this ever-increasing change will almost always lose their competitive edge. Areas such as automation, robotics and information and communication systems are significantly changing and developing. For example the development of digital television broadcasting has resulted in the development and marketing of high definition televisions, digital set-top boxes and plasma screens, severely impacting traditional televisions. The growth of electronic commerce (e-commerce) – the distribution of goods and services over the internet – has seen major changes in the way businesses interact with their customers (B2C) and other businesses (B2B). Customers can now purchase a massive range of goods and services online, from airline tickets to groceries. The framework of laws and regulations in which a business must operate is a complex one. Over many years, laws at all levels of government have been introduced to regulate the way businesses operate. Environmental concerns are becoming more important for business and organisations. Consumers are much more environmentally aware and businesses need to consider the impact their activities have of the environment. They also need to put into consideration whether their activities are ecologically sustainable. Consumers are now also much more socially aware of their actions. As a result, large-scale organisations (LOS) do don’t want to offend any social or cultural views. Westpac is and example of an organisation that has actually made and effort to put social factors before profit. It has developed a social charter and conducted social audits. Australia is increasingly becoming part of a global community. Multinational corporations trade across international boundaries. World trade has become part of everyday life. International consumer trends influence Australian consumers. Global events such as the terrorist attack in New York on 11 September 2001 have had a gigantic impact on the global economy. After September 11 there was a general economic downturn. However, during this time Australia’s relatively isolated and secure position was seen to be an advantage, offering security to investors and creating demand for exports. This crisis actually aided the Australian industry and secured a good position for growth. In fact the Australian Bureau of Statistics reported that the Australian economy grew 4.1 per cent over the year to December 2001.
 * People – Employees, managers and owners.
 * Resources – Buildings, land and capital
 * Culture – Informal; beliefs, values and practices within the organisation
 * Work processes – They way day to day tasks are carried out
 * Consumers or Customers – This is very important because if a customers needs are not satisfied they have a right of choice to seek the product or similar elsewhere
 * Suppliers – They provide raw materials to the organisation and want to know that will be paid on time, and look at having a ongoing relationship with the organisation.
 * Employees - Provide labour in return wages.
 * Competitors – These want a fair competition, with a “level playing field”.
 * Economic Factors **
 * Technological Factors **
 * Legal and Political Factors **
 * Environmental Factors **
 * Social Factors **
 * International Factors **