Business environment 

Business environment is the surrounding in which business exists. No company can survive in market by ignoring the effects of business environment.  Business environment provides constraints as well as opportunities for the business man.

            Features of business environment:

1.       External forces

2.       Uncertainty

3.       Dynamic

4.       Complex

Business environment is of 2 types   :

a)      Internal environment

·       It is the environment present within an organization.

·       Organization have control over the factors effecting internal environment

·       Controllable and manageable

b)      External environment

·        It is the environment present outside an organization.

·       Organization do not have control over the factors affecting external environment

·       Uncontrollable

 

          Dimension of business environment:  It means all factors, forces and institution which have direct and indirect influence over the business transactions.

a)      Economic environment: It consists of GDP (Gross domestic product) Per capita income, profit earnings ratio, monitory and fiscal policy etc. the economic environment factor have immediate and direct impact on businessman.

b)      Social environment: It consists of custom and tradition of the society in which business exist. It includes standard of living, taste, preferences and education level of people. The social environment may not have immediate impact but in the long run, it has great impact on business.

c)       Political environment:  It consist of all the factors related to government affairs such as type of government  in power, attitude of government, policy changes implemented by different government etc. the political environment has immediate and great impact on business.

d)      Legal environment: It consists of laws and various regulations. The businessman can’t over look the laws because he has to perform his business transaction within in the framework of legal environment.

e)      Technical environment: It refers to changes taking place in method of production, use of new equipment and machineries to improve quality of product. The business man should monitor and implement the technological changes taking place in the industry.

 

Ø  Management

§  The word “management” derived from Greek word ‘nomos’ which means ‘management’.

§  It includes a group of people, who accept the responsibility to run an organization and perform its activities, form the management of that organization.

§  The art of getting things done.

 

DEFINITIONS

§  Hicks, “the process of getting things done by the people and through the people”.

§  Henry Fayol, “To Manage is to forecast, and to plan, to organize, to command and to coordinate.”

§  Taylor, “Management is an art of knowing what you want to do and then seeing that it is done in best and cheapest way”.