External and Internal Environments

Topics: Strategic management, Financial services Pages: 7 (2182 words) Published: January 14, 2013
Assignment 2: External and Internal Environments

Monique Allen Brodnax
BUS 499 Business Administration Capstone Dr. Lucinda Blue

Strayer University
July 28, 2012

Segments of the General Environment

This research paper will describe Capital One’s general environment, technology and political and legal segments, forces of competition, Predicting and addressing forces, strengths, weakness, opportunities and threats (SWOT) as well as resource capabilities. The external environment affects a firm’s strategic actions. Essentially, if a company decision has created a disaster in the environment, they intern make corrective actions. According to the Hitt et al. (2003),“strategic actions are affected by conditions in other segments of its general environment, such as the political/legal, social/cultural, and physical environment segments” (Hitt, 2003). For more than 20 years, communities have seen Capital One work to build a lastingly immense business in financial services. Capital One has chosen the businesses that they have with extraordinary care. For instance, they have created great tools to manage risk. They have also built a continuous balanced sheet (Capital One, 2011). Specifically, Capital one is best known for creating and building a successful credit card business. Essentially, if unauthorized persons were to get access to personal, confidential or proprietary information, it could result in legal and financial exposure. Capital One business is also subjected to increased litigation risks because of regulated financial services industry, and the structure of the credit card industry including practices in the mortgage lending business (Capital One, 2011). Technology, Political and Legal Segments

The Internet provides significant opportunities for any company. In fact, Capital One would benefit from utilizing the Webb. Hitt et al. (2003) discuss that since many individuals use the web, a company could send messages to customers about specials and new products especially, if they have visited the site previously. For example, “a number of other companies such as Netflix also collect demographic data about their customers in an attempt to identify their unique preferences (Hitt, 2003). Perhaps, Capital One would benefit from this innovative action to reach potential stakeholders and valuable customers. Product Innovations. Product innovations consist of new communication technologies. Capital one must apply knowledge to address possible threats and create opportunities. For instance, with an increase in smart phones, applications can be introduced to allow online banking at any time. Essentially, technology touches every aspect of our personal and professional lives. Noe (2010) state, “Technology- based learning has helped improve learning efficiency” (Hitt, 2003). Successfully working with and managing technology can be a demanding process.

Political/Legal Segments. The political and legal segment deals with organizations and interest groups. These groups compete for attention, resources, and a voice in regulating laws. The political and legal segment also guides interactions among nations, firms and governmental agencies (Hitt, 2003). Educational Philosophies and Policies. Education is vital therefore; it plays a major part in the solution and in the design of policies. Since the early 1980’s according to Fowler, a new policy environment proposes change due to crisis and situations (Capital One, 2011). Capital One is devoted to provide resources to help students succeed on the field, in the classroom, and in their communities. According to Cabrera, (2008) “it is true that one school alone can do little to change the world, but there is much we can and must do collectively as educators” (Hitt, 2003). For this reason, Capital One should continue to...
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