BusinessBusiness EnvironmentEnvironment
Lecture Notes for Business and Lecture Notes for Business and Management Management
Dr. Fahmy Radhi, MBADr. Fahmy Radhi, MBA
Business EnvironmentBusiness Environment
Business Environment is Business Environment is individual and organization individual and organization that exist outside the that exist outside the business and have business and have influence direct and influence direct and indirect to the business. indirect to the business.
Business Environment ElementsBusiness Environment Elements
SupplierSupplier – supply materials, machine, – supply materials, machine, service and information used to service and information used to produce its products and servicesproduce its products and services
Financial institutionFinancial institution – the capital – the capital resources that available for the firmresources that available for the firm
CustomersCustomers – targets for the firm to – targets for the firm to market its products and servicesmarket its products and services
CompetitorCompetitor - all of the entities that - all of the entities that compete with the firm in marketplacecompete with the firm in marketplace
Business Environment ElementsBusiness Environment Elements
Stockholders/owners Stockholders/owners – persons who are – persons who are invest money in the firm and represent the invest money in the firm and represent the high level of managementhigh level of management
labor unionlabor union – organization of skilled and – organization of skilled and unskilled workersunskilled workers
The communityThe community – people in the area – people in the area where the firm perform its operationwhere the firm perform its operation
Government Government – federal, state and local – federal, state and local level government that provides not only level government that provides not only constraints in the form of law, regulation, constraints in the form of law, regulation, and taxes taking but also provides and taxes taking but also provides assistance in form of purchases, assistance in form of purchases, information and funds.information and funds.
Environmental managementEnvironmental management
Environmental managementEnvironmental management – how to manage the – how to manage the environmental elements by executing strategies environmental elements by executing strategies that alter uncertainly environment to a certain that alter uncertainly environment to a certain extentextent
Environmental Management Strategy:Environmental Management Strategy: Independent StrategyIndependent Strategy – carry out its own – carry out its own
resources to make better its environmentresources to make better its environment Cooperative StrategyCooperative Strategy – involve working with – involve working with
other environmental element for the same purposeother environmental element for the same purpose Strategic Maneuvering Strategic Maneuvering – try to alter its – try to alter its
environmentenvironment
Environmental managementEnvironmental management
Basic Strategy
Specific Strategy Example
Independent Strategy
Competitive aggression
Legal ActionPolitical Action
Product differentiationAggressive Pricing and
AdvertisingSuits brought against
competitorsLobbying
Cooperative Strategy
Co-optationCoalition
Consumer representativesIndustry Association
Strategic Maneuvering
Domain SelectionDiversificationMerger and
Acquisition
Entry in specific marketWide product mixMerger with competitors
Social ResponsibilitySocial Responsibility
Social Responsibility – Social Responsibility – the the awareness that business awareness that business activities have an impact on activities have an impact on its environment so it should its environment so it should try to balance its try to balance its commitment in its commitment in its environmentenvironment
Social ResponsibilitySocial Responsibility
Responsibility to consumers, such as: Responsibility to consumers, such as: the right to safety, the right to safety, the right to be informedthe right to be informed the right to choose, the right to choose, the right to be heardthe right to be heard
Responsibility to employees, such as: Responsibility to employees, such as: The right to safety The right to safety The right to equality in the workplace,The right to equality in the workplace, The right to improve its capabilityThe right to improve its capability
Social ResponsibilitySocial Responsibility
Responsibility to investors, such as: Responsibility to investors, such as: The right to be proper management of funds The right to be proper management of funds The right to access informationThe right to access information
Responsibility to the environment, such asResponsibility to the environment, such as Preventing to water and air pollution, Preventing to water and air pollution, Safe to the land and ForestSafe to the land and Forest natural resourcesnatural resources
Social responsibility, such as Social responsibility, such as Community support Community support Social auditSocial audit
Business ChallengesBusiness Challenges
Challenges in the Economic Challenges in the Economic Environment Environment
Challenges in the Competitive Challenges in the Competitive EnvironmentEnvironment
Challenges in the Social and Culture Challenges in the Social and Culture EnvironmentEnvironment
Challenges in the Political-Legal Challenges in the Political-Legal EnvironmentEnvironment
Challenges in the Technological Challenges in the Technological EnvironmentEnvironment
Challenges in the Economic Environment Challenges in the Economic Environment
MacroeconomicsMacroeconomics MicroeconomicsMicroeconomics The Forces of Supply and DemandThe Forces of Supply and Demand The Business CycleThe Business Cycle State BudgetState Budget International Trade International Trade
Challenges in the Competitive EnvironmentChallenges in the Competitive Environment
Types of Market StructureTypes of Market Structure Global CompetitionGlobal Competition Dealing with CompetitorsDealing with Competitors
Challenges in the Social and Challenges in the Social and Culture EnvironmentCulture Environment
Changing PopulationChanging Population Cultural ValuesCultural Values Social ResponsibilitySocial Responsibility Consumerism and EcologyConsumerism and Ecology Business EthicsBusiness Ethics
Challenges in the Political-Legal Challenges in the Political-Legal EnvironmentEnvironment
Government RoleGovernment Role Business and PoliticsBusiness and Politics Law enforcementLaw enforcement
Challenges in the Technological Challenges in the Technological EnvironmentEnvironment
Technology DevelopmentTechnology Development Applying TechnologyApplying Technology Technology TransferTechnology Transfer
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