Business Environment
Business EnvironmentProf. Swagat Kishore Mishra
ContentsDefination, Themes and IssuesStabilizing the
EconomyEconomic, Technological, Political, Legal and Socio-Cultural
International Business EnvironmentDomestic and Global Business
EnvironmentChanges and Challenges in Business
EnvironmentMacroeconomicsGross Domestic ProductA Case Study on
Odisha GDP Accounting The Odisha Economic Survey 2012-13Gross
State/District Domestic Product
7/5/2015Business Environment, BIMTECH-BBSR7/5/2015Business
Environment, BIMTECH-BBSRDefination, Themes and IssuesStabilizing
The EconomyBusiness Excellence: Business EnvironmentSurvival of
enterprises with growing competitionEconomic, Technological,
Political, Legal and Socio-Cultural Environment
Whole enterprise managementConstant improvement for individual
stakeholdersEmployees, Shareholders, Customers and SocietyBut how
to assess the achieved status of the Business Excellence taking
into account constant changes of the global business environment
?Favorable Business EnvironmentEthics, Economy, Environment,
Business, Location and Stakeholders, etc.
7/5/2015Business Environment, BIMTECH-BBSRInternational Business
EnvironmentInternational Business EnvironmentGlobalization
(OECD)*Increasing the dependence of markets and national
economiesInduced by high dynamics of the trade with goods, capital,
services, transfer of technologies, etc.Know-how the conquest of
the global economic space without boundariesModified or
standardized both micro and macro economically
*Organization for Economic Cooperation and Development
7/5/2015Business Environment, BIMTECH-BBSR7/5/2015Business
Environment, BIMTECH-BBSRChanges and Challenges in Business
EnvironmentMacroeconomicsSeparate from MicroeconomicsStudy of
aggregatesNational Income, Economic Growth, Unemployment, Foreign
Trade, Inflation, Fiscal and Monetary Policy, etc.Explain economic
eventsDevise policies to improve economic performanceJohn Maynard
Keynes, General Theory of Employment, Interest and Money,
1936Theory of output and employment: Macro and Theory of individual
industry or firm: MicroSome Nobel Macroeconomists7/5/2015Business
Environment, BIMTECH-BBSRMilton FriedmanJames TobinFranco
ModiglianiRobert SolowRobert LucasGeorge AkerlofEdward PrescottPaul
KrugmanThomas J SargentChristopher A SimsEdmund S PhelpsGross
Domestic ProductGDP Nations total income and the total expenditure
on its output of goods and services.Total income of everyone in the
economyTotal expenditure on the economys output of goods and
servicesMarket value of all final goods and services Produced
within an economyIn a given period of time
Value of goods and services measured at current prices (Nominal
GDP)at constant set of prices (Real GDP)
7/5/2015Business Environment, BIMTECH-BBSRNational IncomeHow
much everyone in the economy has earned?Does GDP per-capita reflect
true economic wellbeing?
GDP is sum of four categories of expenditureConsumption (C)
Investment (I)Government Purchases (G)Net Exports (NX)
Gross National Product (GNP) = GDP + Factor Payments from Abroad
Factor payments to AbroadNet National Product (NNP) = GNP
DepreciationNational Income (NI) = NNP Indirect Business
TaxesPersonal Income = NI Corporate Profits Social Insurance
Contribution Net Interest + Dividends + Government Transfers +
Personal Interest IncomePersonal Disposable Income = PI Personal
Tax and Non-tax payments
7/5/2015Business Environment, BIMTECH-BBSRTrivia (True or
Not)Real GDP rises only when the amount of goods and services has
increasedNominal GDP can rise either because output has increased
or because prices have increased Nominal GDP / Real GDP = GDP
Deflator CPI = Laspeyres Index (overstates inflation) GDP Deflator
= Paasche Index (understates inflation)GDP = Y = C + I + G + NX
7/5/2015Business Environment, BIMTECH-BBSR7/5/2015Business
Environment, BIMTECH-BBSRA case study on Odisha GDP AccountingThe
Odisha Economic Survey 2012-139th largest state of India (1,55,707
sq.km.) Contributes 2.50% of NI, Growth rate at 9.14% Time period:
2012-13 AGross State/District Domestic ProductReal per-capita
income at Rs. 24, 134 in 2011-12 at 2004-05 prices (was Rs. 14, 862
in 1999-2000)GSDP growth in nominal termService sector dominates
GSDP (58.3% in 2012-13)Industry at 24.2% and Agriculture at 17.5%
(real terms at 2004-05 prices)Gross District Domestic Product
(GDDP) of Odisha: Sundergarh highest and Net District Domestic
Product (NDDP) of Odisha: Jharsuguda highest
7/5/2015Business Environment, BIMTECH-BBSRGross State Domestic
Product (GSDP)7/5/2015Business Environment, BIMTECH-BBSRFig 1:
Odisha GSDP**Source: Author**Based on the data from Annual Budget
2013-14, Govt. of OdishaSectoral contribution in
GSDP7/5/2015Business Environment, BIMTECH-BBSRFig 2: Odishas
Sectoral contribution to GSDP***Source: Author***Based on the data
from The Odisha Economic Survey, 2012-13Weakness in GDP
estimateGreen GDP accounting is equally essentialHuman development
progress must be reflectedDistribution of income and wealthEconomic
welfare International economies7/5/2015Business Environment,
BIMTECH-BBSRReconciliation7/5/2015Business Environment,
BIMTECH-BBSRFig 3: Mapping the discussionSource: AuthorCurrent
Status: Indian EconomyGrowth is forecast to accelerate to 8.1
percent in 2015 and 8.2 percent in 2016 (UN ESCAP report titled,
'Economic and Social Survey of Asia and the Pacific 2015)
Indian economy to grow at 7.3% in 2015: Moody's Analytics
7/5/2015Business Environment, BIMTECH-BBSR
KeywordsBusiness EnvironmentBusiness
ExcellenceGlobalizationMacroeconomicsGross Domestic ProductState
Gross Domestic Product (Odisha)Expenditure and Income
ApproachesLaspeyres and Paasche IndicesCurrent and Constant
PricesNational IncomeAdvance, Quick and Revised Estimates
7/5/2015Business Environment, BIMTECH-BBSRReadingsText BooksThe
Business Environment: Themes and Issues, Paul Wetherly,Dorron
Otter, 2nd Edition, Oxford PublicationMacroeconomics, N. Gregory
Mankiw, 7th Edition, Worth PublishersThe International Business
Environment, Challenges and Changes, 2nd Edition, Ian Brooks,Jamie
Weatherston,Graham Wilkinson, Pearson Publication
Research Studies, News Media, Annual Reports and White PapersThe
Odisha Economic Survey, 2012-13, Planning and Coordination
Department, Government of OdishaMiriam Jankalova, 2012, Business
excellence evaluation as the reaction on changes in global business
environment, Procedia- Social and Behavioral Sciences, Vol. No. 62,
pp. 1056-1060Annual Budget 2013-14, 2013, Odisha FRBM Rules 2005,
Report, Government of Odisha
7/5/2015Business Environment, BIMTECH-BBSRThank You
