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CHAPTER
3
The Environment of
Organizations and
Managers
Learning Objectives
After studying this chapter, you should be able to:
33
Chapter Outline
The Organizations
Environments
The External
Environment
The Internal
Environment
Owners
Board of Directors
Employees
34
External environment:
1.
everything outside an
organizations boundaries that might affect it. Its
mostly uncontrollable or may be control up to a limit.
I.
ii.
2.
Internal environment:
within an organization.
International
dimension
Technological
dimension
Competitors
Regulators
Politicallegal
dimension
Strategic
partners
Suppliers
Economic
dimension
Sociocultural
dimension
Internal environment
Task environment
Owners
Customers
Employees
Physical environment
Board of directors
Culture
External environment
Copyright
environment
by Houghton Mifflin Company. All rights reserved.
General
36
Figure 3.1
37
Economic Environment GE
Trends of interest:
Inflation
Interest Rates
(12.5 %)
132. Pakistan
169.
Afghanistan
US $ 83,841
78,395
52,561
50,523
49,110
46,381
43,007
42,748
39,938
39,468
38,911
23,221
2,941
2,661
935
Pci 1207
Technological Environment:
GE
Rates of obsolescence
Cultural
environment
Political
environment
for safety
for consumer protection
to protect special interests
Demographic
Environment
Changing households
Literacy Rate
Geographic shifts/Immigrants
Male/female/infants
Increased diversity
Natural Environment
Anti-pollution pressures
McDonalds General
Environment
International Dimension
Restaurants in 115
countries
About two-thirds of
sales from outside
the United
States
Political-Legal
Dimension
Government
food standards
Local zoning
climate
General posture
toward business
regulation
Internal environment
Task environment
External environment
Copyright
environment
by Houghton Mifflin Company. All rights reserved.
General
Technological
Dimension
Improved information
technology
More efficient
operating systems
McDonalds
Economic
Dimension
Strong economic
growth
Low unemployment
Low inflation
Sociocultural Dimension
Demographic shifts in
number of single adults
and dual-income families
Growing concerns about
health and nutrition
316
Figure 3.2
regulatory agencies.
interest groups.
317
Task Environment
Is composed of specific groups and organizations that affect
the firm.
The main actors are competitors, customers, suppliers,
strategic partners & regulators.
1.
a)
b)
Cont
c)
d)
320
2. Suppliers
Firms and individuals that provide the resources needed by the company
and its competitors to produce goods and services. 3M must watch supply
availability, shortage or delays, labor strikes, price trends etc.
3. Marketing Intermediaries
Firms that help the company to promote, sell
and distribute its goods to final buyer; they
include
Resellers,
Marketing-service agencies
Financial intermediaries.
4. Regulator
A unit that has the potential
to control, legislate, or
influence an organizations
policies and practices.
5. Strategic partner
Two or more separate
companies combine efforts
together to develop and
operate a specific business.
Regulators
Food and Drug
Administration
Securities and
Exchange
Commission
Environmental
Protection
Agency
Competitors
Burger King
Wendys
Subway
Dairy Queen
McDonalds
Strategic Partners
Wal-Mart
Disney
Foreign partners
Customers
Individual
consumers
Institutional
customers
Suppliers
Coca-Cola
Wholesale food
processors
Packaging
manufacturers
Internal environment
Copyright by Houghton Mifflin Company. All rights reserved.
Task environment
323
Figure 3.3
Employees are persons who work for the firm and have a
vested interest in its continued operation and existence.
324
1.
The Company:
2.
3.