Business environment

 BUSINESS ENVIRONMENT 

INTRODUCTION:

                       This unit discusses about various internal and external environmental factors like social, cultural, political etc. which has major influence on the working of an any business entity. All these factors and their implications are discussed. Further it discusses about  various macro economic phenomena of output unemployment and inflation.

•  Business environment definition
• Feature
• Business environment factors and importants /Implications  

                1.Social Factors

              2.Economic Factors

              3.Culture Factors        

              4.Technology Factors

              5.Political Factors

              6.Legal Factors

              7.Ecological Factors 

• Macroeconomics concept                                      1. Output and Income                                      2.  Unemployment

                3. Inflation and definition

• Business Environment definition 

           It means a business is made up of various surroundings which  are  called as business environment.

             Business is made up of some interna and external factors , so those factors are the business environment. 

• Feature

• Business environment Factors

1)Social  factors 

             society   is  where   the   business   exists  and  member   of  a  society  constitute  the  business  as  entrepreneur s ,manager, workers,  customers,  prospective,  customers   and other.  The social environment, social context, social cultural context refers to the immediate physical and social setting in which people live or in which something happens or develops. It includes the culture that the individual was educated or lives in, and the people and institutions with whom they interact. The interaction may be in person or through communication media, even anonymous or one-way, and may not imply equality of social status. Therefore the social environment is a broader concept than that of social class or social circle.

 Importants and Implications

• Productivity and prosperity first for the employment, then for  the  market.
• Environment  sustainability  if  not  catered  to well  will  be  deteriorating  one  and  all
• If  people  who are  not  the  part  of  a  business  directly  are not  happy, they  some  day  would  refute  to the existence  of  the business  itself
• Recently ,KFC  and  Mc Donald’s  declared  completely  vegetarian  outlets    

2) Economic  factors 

               Growth rate , Gross domestic product, Gross national product, national income , per capita income, per capita energy consumption. The fundamental information at factors business investment value.  Economic  factors include labor cost, interest rates,government policy,taxes and management

 Importants and Implications

• Looking  at  the  economic  factors  listed above especially  with  the  perspective  of  business  willing  to  enter  into  the  indian market.
• GDP,  GNP  and  other  indicators  are  significant  in  suggesting  the  willingness  of  the  people  of  a  country  to  work, product  and  excel. 

 3)Cultural  factors 

                     Culture  is  the   characteristics   and   knowledge  of  a  particular  group  of     people, religion, cuisine, social habit  . When one thinks of a country like India with lot of diversity in culture, language,ways of life and even social structure one has to plan methodically.

   Importants and Implications

• Languages
• Religion
• Consumer preference 
• Habits
• Social trend

4) Technological Factors

                   Own  technology  development  in  place   it  always  has an edge  in  relation  to  business   development. External factors in technology that impact business operation. Changes in technology affect how a company will do business. A business may have to dramatically change their operation strategy as a result of changes in the technological factors.

                  

5)Political factors 

                  Government  actions  which  affect  the  operation   of  a  company   or  business . These  actions  may  be  on   local,  regional, national  or international  level.  Political philosophy ideology and stability is important for business and policy to be steered in a structured and long lasting frame at the time when economic restructuring is required monetary and fiscal policy alignment is required.

6)Legal factors 

                Presence  of   low   timely  and   due  amendment   and  proper  execution  and   enforcement   is  very  important.   Legal factors are external factors which refer to how the law affects the way businesses operate and customers behave. Product transportation, profit margins, and viability of certain markets are all examples of things which may be influenced by legal factors.

7)Ecological   factors 

      Humans at the time of industrial revolution did not ever think of the ecological imbalances those would come along and would tend to create disturbances beyond the control of individuals and standalone organization. The  relationship  between  organisms  and  their  environment. Government  policies, Labour  and  Legal  factors . Foreign   direct   investment ,  patent  policy  and  law,  foreign  investment   in  retail  higher  education,   telecom   and   so  many  other   aspects   have  brought   in  pivotal  changes  in  Indian   business  scenario. 

Macroeconomic  concepts 

• Branch  of  economics  which  studies  economics  issues  and  problems  at  the  level  economics  whole.
• It  studies like output and income,  unemployment,  inflation  and  deflation 

 Output  and income 

• There  are  two oft-cited  indicators  of  macroeconomic  performance
• GDP  : a measure  of  output  and  income  defined  over  a  geographic  area
• GNP : an  ownership  based  measure  of  output  and  income

   

Unemployment

• The  amount of unemployment in an economy is measured by the unemployment rate, the percentage of workers without jobs in the labour forces. The
•  labour forces only includes workers  actively looking  for job . 

Inflation and deflation