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Tuesday, 3 November 2020

What environmental influences on business?

All living creatures including human beings live within an environment. A part from the natural environment, environment of human include family, friends, peers, neighbours and society.it is also includes men handmade structures such as building, furniture roads and other physical infrastructure.

Just like human beings comma business also does not function in an isolated vacuum. Businesses function within a whole gamut of relevant environment and have to negotiatetheir way through it. The extent to which the business thrips depends on the manner in which it interacts with its environment to be successful business has to not only recognise different elements of the environment but also respect, added to or manage and influence them.The business must continuously monitor and adapt to the environment if it is to survive and prosper.

A successful business has to identify a prize and respond to the various opportunities and threats in its environment.business functions as a part of the border environment. The inputs in the form of human physical financial and other related resources are drawn from the environment post of business converts these resources through various processes into outputs of products and/or services. the latter is partly exchanged with the external client groups se customers. The exchange process brings in some surplus or profits reputation of goods public image and so on to the business which could be stored and used for further development and growth. different organizations use different inputs to adopt different processes and produce different outputs. For example and educational institution produces literate people. a hospital provides health and medical services.

Organizations depend on the external environment for the inputs required by them and for disposing of their outputs in a mutually beneficial manner. The out input and output exchange activity is a continuous process and calls for active interaction with the external environment.

The framework to understand environmental influences: in spite of the problems in understanding the business environment for organizations cannot ignore it will make an attempt to identify a framework for understanding the environment of organizations.

This will help in identifying key issues coma find ways of copying and complexity and also assist in challenging managerial thinking.

Firstly, it is useful to take an initial view of the nature of the organization's environment in terms of how to insert it is. Is it relative Li static or does it show signs of change form and in what ways? Is it simple or complex to comprehend? this helps in deciding what focus the rest of the analysis is to take.

secondly, the next step might be the auditing of environmental influences. Here the aim is to identify which of the many different environmental influences are likely to affect the organization's development of performance. It is useful to identify the influencing factors and relate such influences.
The final step is to focus more on and explicit consideration of the immediate environment of the organization-for example the competitive arena in which the organisation operates.

there should be an attempt to understand why the forces are of strategic significance. It is also required to analyse the organisations competitive position:that is how it stands in relation to those organisations competing for the same resources or customers as itself. when the company does not react to the demands of the environment by changing its strategy the result is declining performance of the company in the market. The utility of environmental analysis: for environmental analysis statistics get time to anticipate opportunities and to plan to take external responses to these opportunities. It is also a strategy to develop an early warning system to prevent threats or to develop strategies which can turn it led to a firm's advantage.
it is clear that because of the difficulty of assessing the future not all future events can be anticipated. To the extent that some or most are anticipated by this analysis and diagonal orgies, managerial decisions are likely to be better. The managers can concentrate on this fue instead of having to deal with all the environmental influences.

Purpose of environmental analysis: in general environment analysis has three basic goals as follows:

First, comedy analysis should provide an understanding of current and potential changes taking place in the environment. It is important that one must be aware of the existing environment. At the same time, one must have a long-term perspective about the future too.
second, environmental analysis should provide inputs for strategic decision making. Mere collection of data is not enough. the information collected must be useful for and used in strategic decision making.

Third, environment analysis should facilitate and foster strategic thinking in organizations-typically a rich source of ideas and understanding of the contacts within which a firm operates. It should challenge the current wisdom by bringing fresh viewpoints into the organization.
Environmental scanning: organizational environment consists of both external and internal factors. The environment must be scanned so as to determine the development and forecast of factors that will influence organizational success. environmental scanning can be defined as the process by which organisations monitor their relevant environment to identify opportunities and threats affecting their business for the purpose of taking strategic decisions. It is a process of gathering information regarding companies environment analyzing it and forecasting the impact of all the table and why mental changes for it helps the managers to decide the future part of the organization.
scanning must identify the threats and opportunities existing in the environment. While the strategy formulation, an organization must take advantage of the opportunities and minimize the threats. A threat to one organization may be an opportunity for another. the factors which need to be considered for environmental scanning our events trends issues and expectations of the different interest groups to stop these factors are explained below: events are important and specific occurrences taking place in different environmental sectors. Events are certain happening in the internal or external organizational environment which can be observed and tracked.
Trends are the general tendencies of all the courses of action along which event take place. Trends are grouping of similar or related events that tend to move in a given direction increasing or decreasing in strength of frequency of observation samikaran usually suggest if pattern of change in the particular area. issues are the current concern that arises in response to event and trends for stock identifying and emerging issues is more difficult. Emerging issues start with the value shift or change in how many issues is viewed expectations are the demands made by interested groups in the light of their concern for issues.




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