Analysis Of The External Environment Of Business

1663 words - 7 pages

Analysis of the External Environment of Business

A ‘business' is commonly defined as an organisation which provides goods or services in addition to transforming input into output. Its objectives can either be profitable or non-profitable. One of the main requirements that must be fulfilled for a business to exist is that it must act and react to activities and occurrences beyond that of the organisation. These factors that happen outside of the business are known as external influences or factors. They have a major influence on a business with respect to the main internal functions and occasionally their objectives and strategies. However, the overriding factor that affects most business is the degree of competition between themselves and another business that provides the same product or service. Other significant influences are social, legal, economic, political and technological factors.
Technology is defined as ‘the sum of knowledge of the means and methods of producing goods and services' (Penguin Dictionary of Economics- The Business Environment, Worthington and Britton). It is also ‘increasingly science based, encompassing things like chemistry, physics and electronics, and refers to the organisation of production as well as the actual techniques of production itself.' (The Business Environment-Worthington and Britton)
The major technological factor that affects business is technological change, in particular, the rapid pace of change in production processes and product innovation. As a result of this, new products are introduced, adjustments to the organisation and method of production are implemented, alterations to the quality of resources and products are made, and new ways of distributing the product and storing and disseminating information are set up. The substantial changes in technology have had varying impact upon business and the economy and the effects are many and varied.
A major technological change is the developments that have been made in information technology and the use of computers. These are mainly to improve the efficiency and competitiveness of business, and as the changes in technology are so rapid, there are important implications for businesses. Such developments prompt businesses to transform existing activities within the business in addition to generating new ones. New activities mainly involve the handling, analysis, collection and transmission of data. These advancements have varying impacts on business, such as improvements of goods and services within technological change in production. This is mainly due to computer-aided manufacturing (CAM), computer-aided design (CAD) and computer-integrated manufacturing (CIM). CAM means the computer controls the machinery, CIM is where the computer controls the whole production line, and CAD enables the computer to help design products using computer generated models and 3D drawings. The effects these implementations are having on...

Find Another Essay On Analysis of the External Environment of Business

Analysis of the external environment of "Ryanair –"Southwest" of European airlines" case

1722 words - 7 pages The objective of my report is to analyze the external environment in "Ryanair-'Southwest" of European airlines" case, which is very important factor for the firm's formulated effective strategy. The external environment consists of a wide array of economic and sociopolitical factors. It is the specific market arenas that the organization has chosen in its strategy; it provides the business opportunities to the firm and it's also a source of

The Effect of the External Environment on Work in Australia

2034 words - 8 pages The Effect of the External Environment on Work in Australia This essay considers how changes in the external environment of organisations have altered the world of work. Australia is currently experiencing a period of economic growth. But some new challenges have appeared. Australian organisations are facing skill shortages and an aging workforce. This shortage has been addressed by introduction of new technology in workplaces and influx of

The External Environment for the Development of Foreign Package

1927 words - 8 pages 3.1.3. The external environment for the development of foreign package 1. China's global competitive environment, outsourcing Till 2002, the United Nations in July 2005 the development of national service outsourcing to a survey, China's service outsourcing industry has great potential for foreign direct investment. In inflows of foreign direct investment projects in the "Customer Support Center" A, China ranks 6th in the world, the project

HRM & the External Environment

3568 words - 14 pages Executive SummaryIncreased global competition coupled with enhanced customer expectations means that the growth or even survival of a firm is difficult. Organizations need to respond to a rapidly changing global environment, and to any company continued success is dependent on attracting and retaining high-quality individuals who can respond effectively to this changing environment.In light of Wal-Mart's intention to extend its business

Industry and External Environment Analysis

3196 words - 13 pages Introduction Companies always operate in a certain environment; the formulation and implementation of business strategy are also restricted by the particular environmental factors. (Osborn & Hunt 1974) In other words, environment decides the enterprises’ strategy, decisions making, organizational structure and management styles. The environmental awareness has become the starting point of the environment analysis. (Sethi 1979) In general, the

Critical Analysis of Internal Resources and External Environment of Wal-Mart

922 words - 4 pages Critical Analysis of Internal Resources of Wal-Mart and External Environment. External Environment We have used Porter’s five forces on the discount retail industry to understand external environment(Porter, Michael E., Competitive Strategy(1988). 1. Threat of new entrants: Low a. Highly price competitive nature of the discount retail industry with already established players vying for market shares forbids new entrants. High entry barriers

The External Environment directly affects what a manager does

2553 words - 10 pages & the T stand for Opportunities & Threats respectively in the external environment) analysis introduced by Albert Humphrey and his research team at Stanford Research Institute, the PESTLE Analysis introduced by Frances Aguilar and the 05 Forces model and Porters Diamond introduced by Michael Porter of the Harvard Business School were created with the express purpose of providing a framework for scanning and analyzing the external environment

Discuss how organization structure interacts with the external environment to affect organizational performance

1256 words - 5 pages internal environment and how culture plays a role in an organisation's ability to fit in with the environment. According to (Samson and Daft, 2003:80) the internal environment is "composed of present employees, management and business culture". This essay will investigate how culture plays a role in the organisations overall success.In addressing the issue it will be shown how the external environment has changed in terms of how organisations are

Analysis of the Overall Business Environment of M&S

3302 words - 14 pages 1. Introduction The main purpose of the research is analysing the overall business environment of M&S. The research will be carried out to identify the current issues facing by M&S as a specialist strategic marketing consultant. It explores the relationship between stakeholders and perception of customer attitude toward the organisation. In addition, it finds out the competitive position with rivals, sustainability strategy, marketing tactics

the business environment of ireland

1441 words - 6 pages . (2011, September 22). A History of the Irish Education System. Retrieved from Teach, Don't Preach: http://www.teachdontpreach.ie/2011/09/a-history-of-the-irish-education-system-2/ Invest in Ireland. (2014). Retrieved from IDA Ireland: http://www.idaireland.com/ Ireland borrows €1bn at lowest-ever long term interest rate. (2014, March 03). Retrieved from Breaking News: http://www.breakingnews.ie/business/ireland-borrows-1bn-at-lowest-ever-long-term

Analysis of the Business Environment of the Telecommunication Industry in India

1422 words - 6 pages accounts for major source of revenues for the telecom players with Bharti Airtel earning 82.6% of its revenue from voice services as compared to 70% of Vodafone. 3.3. General Business Environment Like every other industry, telecom sector is also affected by the external environment. Some of the outside forces which have an impact on the telecom sector (voice) have been outlined below: • Political – As the industry is highly regulated, political

Similar Essays

Analysis Of The External Environment Of Business

1591 words - 6 pages Analysis of the External Environment of Business The Technological Environment The external business environment consists of four elements, they are as follows: Political, Economic, Social and technological. It would be impossible to analyse the whole environment in one essay, I have therefore decided to focus my essay on the technological environment. I have chosen this area to focus on because as Palmer and Hartley point out, it is one

Qantas International: Analysis Of The External Environment

2163 words - 9 pages currently doesn't fly” (Virgin, 2001). Qantas as a whole has recovered some of this lost market share through its low cost business Jetstar, which has grown from 2% of the market in FY06 to 8% in FY12, predominantly servicing Asian destinations (Qantas, 2012). External Competitor Analysis Indirect Competition: Etihad and Singapore Airlines have recently increased their share in Virgin Australia in a bid to make an entry into the Australian

Euro Disney Analysis Of The External And Internal Environment

1386 words - 6 pages their environment analysis. In this case there has been a recognition of a trend, which is the trend of people going to theme parks during the weekends for entertainment of them as well as their children. Also here is an existing need for entertainment of this kind. Therefore, an opportunity exists in the European market that Euro Disney could have taken advantage of. However, their failure to pick up signals from the macro environment and

Discuss The Influence Of The External Environment On The Conduct Of The Organisation's Business

1646 words - 7 pages profit. It is also essential to remember two important rules related to customers, as presented below. If the business conducts itslf with regards to cutomers in these way it may ensure it growth and survival, Rule No. 1: The customer is always right! Rule No. 2: When the customer is wrong - use Rule No. 1!PART BThe organisation can shield itself against external environment pressures in a number of ways.Firstly with regards to the socio-cultural