Business Environment, Features - Unit 1

The business environment refers to the external and internal factors that influence the operations and performance of a business.
It includes various elements such as economic, social, technological, political, legal, and ecological factors.
The business environment is dynamic and constantly changing, presenting challenges and opportunities for organizations.

1. BUSINESS ENVIRONMENT By Dr.M.Devaki Assistant Professor Sri Ramakrishna College of Arts & Science (Autonomous) Coimbatore

2. Business Environment The business environment refers to the external and internal factors that influence the operations and performance of a business. It includes various elements such as economic, social, technological, political, legal, and ecological factors. The business environment is dynamic and constantly changing, presenting challenges and opportunities for organizations.

3. Features of Business Environment Complex and Dynamic Uncertainty Interconnectedness External and Internal Factors Influence on Decision-Making Competitive Landscape Opportunities and Threats

4. Concepts of Vision & Mission Statements in Business Environment A vision statement outlines the long-term aspirations and future goals of an organization. It provides a clear picture of what the organization aims to achieve in the future. A mission statement defines the fundamental purpose and reason for the existence of an organization. It describes the organization's core values, primary objectives, and the target audience it serves. Vision Statement Mission Statement

5. Components of Vision Statements Future-Oriented Vision statements focus on the organization's future direction and goals rather than the present state. Inspiring and Motivating A well-crafted vision statement inspires and motivates employees, stakeholders, and customers. Clear and Concise Vision statements should be concise, clear, and easily understood by everyone within the organization. Forward-Thinking Vision statements should reflect a forward-thinking mind-set, encouraging innovation, adaptability, and a willingness to embrace change. Timeframe Vision statements typically have a long-term perspective, outlining the organization's aspirations for the next 5, 10, or even 20 years.

6. Components of Mission Statements Purpose and Scope The purpose of the organization, the industry or market it operates in, and the products or services it offers. Core Values Highlight the organization's core values, which serve as guiding principles for decision-making and behaviour. Objectives and Goals Outline the primary objectives and goals of the organization, providing a sense of direction and focus. Target Audience Identify the target audience or customers the organization aims to serve and satisfy. Distinctiveness Highlight what sets the organization apart from its competitors, emphasizing its unique selling proposition or competitive advantage.

7. Importance of Vision & Mission Statements

8. Types of Environment

9. Internal to the Enterprise VALUE SYSTEM The value system of an organization represents its core beliefs, principles, and ethical standards. It encompasses the fundamental values that guide the behaviour, decision-making, and actions of employees within the organization. A strong and well-defined value system helps create a positive work culture and fosters ethical conduct throughout the organization. It sets the expectations for employee behaviour and establishes a framework for making ethical choices. Organizations with a clear value system are more likely to attract and retain employees who align with those values.

10. Cont... A value-driven culture promotes integrity, transparency, and accountability at all levels. It guides employees in their interactions with colleagues, customers, and other stakeholders, fostering trust and goodwill. A value system that emphasizes honesty, fairness, and social responsibility contributes to the organization's reputation and long-term success. The value system can be changed or replaced at any moment based on the direction of upper management.

11. Core Values

12. Ethical Standards

13. Implementation of Value Systems Leadership Commitment Communication Training and Development Recognition and Reward Measurement and Feedback

14. Examples of Companies with Strong Value Systems Google: Emphasizes innovation, user focus, and ethical business practices. Patagonia: Prioritizes environmental sustainability and ethical sourcing. Zappos : Known for its customer-centric approach and strong company culture. Ben & Jerry's: Combines business success with social responsibility and environmental activism.

15. Management Structure Hierarchical arrangement and reporting relationships. Authority and decision-making. The nature of management. Enable efficiency. Ensures accountability.

16. Types of Management Structures

17. Hierarchical Structure Flat Structure

18. Matrix Structure Divisional Structure

19. Team-Based Structure Network Structure

20. Key Considerations for Choosing a Management Structure

21. Nature Influences employee motivation, satisfaction, and productivity. Effective leaders inspire and empower employees. Fosters a positive work environment. Encourages innovation, provides guidance, and supports professional growth and development. Encompasses the organization's strategic direction. Sets the overall vision, goals, and objectives. Drives the organization's growth, expansion, and adaptation to changes in the external environment.

22. Human Resource Human resources are the employees of an organization. It involves attracting, selecting, training, developing, and retaining the right talent to meet organizational objectives. Recruitment and selection processes aim to identify individuals who possess the necessary skills, knowledge, and competencies required for specific roles within the organization. Human resource management also involves creating compensation and benefits packages that attract and retain top talent.

23. Company Image and Brand Value The company image and brand value represent how the organization is perceived by its stakeholders. It is the reputation and impression that the organization creates through its products, services, actions, and interactions. Customer loyalty and advocacy. Positive word-of-mouth recommendations and referrals from satisfied customers can significantly impact the organization's success. A strong brand value can instill confidence in investors, leading to increased funding opportunities and potential growth for the organization.

24. Loyalty

25. Physical Assets and Facilities Physical assets and facilities include buildings, machinery, equipment, vehicles, and infrastructure. Regular maintenance and upgrades prevent breakdowns and optimize performance. Proper utilization maximizes productivity and minimizes downtime. Strategic planning ensures optimal allocation and utilization of assets. Consider capacity, scalability, cost-effectiveness, and technological advancements. Efficient utilization leads to cost savings and improved operational efficiency. Sustainability and environmental impact are important considerations. Implement energy-efficient measures and waste reduction strategies. Eco-friendly practices demonstrate corporate social responsibility.

26. Research & Development Experimenting with new technologies, and developing new products, services, or processes. Identify emerging opportunities, and develop innovative solutions. Introduction of new products or services that address customer needs and preferences. Continuous improvement and refinement of existing products or services.

27. Intangibles Intangible assets include things like goodwill, intellectual property, brand recognition, copyrights, trademarks, and proprietary technology. Intellectual property protection. Intellectual Property (IP) : Patents : Legal protection for inventions and innovations. Copyrights : Protection for creative works such as literature, music, and art. Trademarks : Symbols, names, and slogans used to identify goods and services. Trademarks and brand names differentiate the organization's products or services from competitors and create brand recognition and loyalty. Brand equity is built through consistent branding strategies, effective marketing, and delivering superior customer experiences.

28. Competitive Advantage Competitive advantage refers to the unique strengths and capabilities that differentiate an organization from its competitors.

29. The external environment SUPPLIERS Supplier Selection and Evaluation Supplier Relationship Management Supply Chain Management Supplier Performance Monitoring CUSTOMERS Customer Segmentation Customer Behavior Analysis Customer Relationship Management (CRM) Marketing and Sales

30. MARKET INTERMEDIARIES Channel Management Retail Management Importance of Market Intermediaries

31. Thank You