The remote environment

External Business Environments The external environment of a business converts inputs into outputs in order to make profits. However, the business does not exist in an empty space, but rather in an external environment consisting of varying factors outside the business. Factors that affect the external environment of a business include the economic system, the social system, the political system, the technological system, and the ecological system. The economic system deals with the organization of the economy to allocate limited resources. The economy can go through periods of fast or slow growth, and businesses typically do best when the economy is great and standards of living are improving. On the other hand, the social system is comprised of attitudes, behaviors, and ideas pertaining to human relationships. The political system creates rules within which businesses can operate. Policies enacted by the government supports and encourages business activities, such as enterprises, while discouraging other activities, such as pollution. Technological factors affect businesses because in order to remain competitive, businesses have to ensure that its processes and systems support innovation. Ecological factors, on the other hand, deals with weather, climate, and climate change. Awareness of climate change can affect how businesses operate and the products they offer.
Economic Factors
There are many economic factors that can affect businesses. A growing economy will provide greater prosperity for businesses. Disposable income is much higher, unemployment is generally lower, and consumer confidence results in people spending money through the purchase of essential and nonessential goods and services. The impact of a slow economy will challenge businesses in numerous ways. Consumers start to worry about job security and as a result, start to worry about expenditures. This results in decreased revenue for businesses. Many businesses may downsize their workforce, which can contribute to the unemployment rate and slow the economy.
One recent economic change affecting businesses was the recent government shutdown in 2013. The shutdown not only adversely affected businesses and families, but also disrupted the economy and had negative impacts on Federal programs and services that support American businesses and individuals. The Council of Economic Advisers has estimated that the combination of the shutdown and debt limit brinksmanship resulted in 120,000 fewer private sector jobs created during the first two weeks of October 2013 (Burwell, 2013). Consumer and business confidence was severely damaged. Federal loans to small businesses, homeowners, and families in rural communities were put on hold, and travel and tourism was disrupted at national parks and monuments across the country, which hurt the surrounding local economies (Burwell, 2013).
Another recent economic change that affected businesses was the recent Ebola outbreak in late 2014. The fear of the deadly disease drove some industries to pull back and others to ramp up. The airline industry, for example, canceled many flights to West Africa, which negatively affected the travel and tourism industries (Snyder, 2014). The oil industry was affected as well since some of the drilling located in the heart of the outbreak zones had to be halted. The protective gear industry and the pharmaceutical industry were in demand to produce supplies and medicine needed to contain the spread of the disease (Snyder, 2014).
Social Factors Businesses operate in a society. The social environment consists of society’s beliefs, customs, practices, and behaviors. Businesses must adapt to its external social environment in order to survive and must be aware of society’s social preferences in relations to its needs and wants. Businesses try to influence social values by marketing and targeted public relations strategies. One recent social change affecting businesses is the topic of same-sex marriage. Businesses who refuse to do business with gay couples can receive backlash and negative publicity, and possibly even lose business as a result. As a result, many businesses have opted to support same-sex marriage by taking advantage of the marketing opportunity in terms of offering discounts, deals, and special promotions for gay couples (Anglen, 2014). Many states across America have deemed same-sex marriage legal prompting businesses to recognize such couples. Another social change affecting businesses is the debate over legalizing marijuana. Businesses in Colorado for example have seen a boost since its legalization. Tax revenue received from cannabis sales is devoted to building schools and funding social programs (Yakowicz, n.d.). New companies are opening to keep up with the demand, such as weed-friendly real estate and construction of new buildings to grow the plant. However, it also has adverse consequences. Although it is legal in Colorado, it is illegal according to federal law. Employers have increased drug testing since the law changed and people continue to be fired for testing positive, affecting the unemployment rate (Yakowicz, n.d.). Political Factors. Businesses can also be affected by aspects of government policy and must comply with the law and the impact legislation has on their operations. One recent political change affecting businesses were new proposed laws to bolster cybersecurity across America in the government and private industry in response to recent high-profile computer breaches involving Sony, Target, and Home Depot (Davis, 2015). The laws would increase prosecution of crimes conducted through computer networks and toughen penalties. It would also shield from liability companies that share information with the government about computer threats. Another political factor affecting businesses is when President Obama recently called on Congress to require companies to give workers up to seven days of paid sick leave each year (Korte, 2015). In addition, he also called to give at least six weeks of paid leave to federal employees after the birth or adoption of a child (Korte, 2015). This legislation is in response to a present day evolving family life in which other countries offer their workers similar incentives. Technological Factors. In order for businesses to better their future and development, they must adapt to technological changes to keep up with market demand. One recent change is the increasing demand for mobility. In the United States, a staggering 90 percent of American adults have a cell phone, with 58 percent having a smartphone (Dillard, 2014). As a result, businesses have begun to develop mobile friendly applications in order to reach out to their customer base. Another recent technological change affecting businesses is software development. Software-defined infrastructure is designed around hardware that implements data transactions from the software layer that creates them (Dillard, 2014). Infrastructure will be treated as a set of resources required for specific workloads and the goal is to use software that can be managed holistically as part of a business. Organizations are beginning to implement software-defined architectures to achieve flexibility and control (Dillard, 2014). Ecological Factors. There are many ecological factors that can affect businesses. There may be set targets to reduce carbon footprint such as waste, emissions, energy use, and recycling. One recent change by President Obama was a proposed new Environmental Protection Agency rule that called to reduce carbon emissions from power plants by 2030 (Hoover, 2014). The new rule could raise electricity prices or possibly save businesses and consumers money by spurring innovations, while possibly reducing healthcare costs. Another recent change was last year’s polar vortex phenomenon that covered much of the country in snow and ice, which affecting approximately 200 million (Lauro, 2014). The weather occurrence resulted in a bad economic disruption affecting the airline industry, schools, the insurance industry, as well as the retail industry and numerous businesses. The approximate toll on American businesses was 15 billion (Lauro, 2014).
Conclusion
The five factors discussed is a great tool to understand market growth and decline, business position, and potential for operations and direction. Through the assessment of these five factors, we gain an understanding of the external environment that affects businesses throughout the United States.

References
Anglen, R. (2014, October 22). Arizona businesses celebrate gay marriage with discounts, deals. AZ Central. Retrieved from http://www.azcentral.com/story/money/business/2014/10/17/ariz-businesses-celebrate- gay-marriage-discounts-deals/17459541/
Burwell, S. M. (2013, November 7). Impacts and costs of the government shutdown. The White House. Retrieved from http://www.whitehouse.gov/blog/2013/11/07/impacts-and-costs- government-shutdown
Davis, J. H. (2015, January 13). Obama calls for new laws to bolster cybersecurity. New York Times. Retrieved from http://www.nytimes.com/2015/01/14/us/obama-to-announce-new- cyberattack-protections.html?_r=0
Dillard, S. (2014, January 20). Top 6 technology trends of 2014 that will affect the businesses. Enterprise CIO Forum. Retrieved from http://www.enterprisecioforum.com/en/blogs/sophinadillard/top-6-technology-trends- 2014-will-affect
Hoover, K. (2014, June 2). 5 ways the EPA’s power plant rule will affect business. The Business Journals. Retrieved from http://www.bizjournals.com/bizjournals/washingtonbureau/2014/06/5-ways-the-epas- power-plant-rule-will-affect.html?page=all
Korte, G. (2015, January 15). Obama to propose paid sick leave for American workers. USA Today. Retrieved from http://www.usatoday.com/story/news/politics/2015/01/14/obama- child-care-paid-leave/21768969/
Lauro, A. (2014, May 19). Retail industry affected by the polar vortex. Go Digital Marketing. Retrieved from http://www.godigitalmarketing.com/retail-industry-affected-polar-vortex- weather/
Snyder, B. (2014, October 13). Ebola outbreak’s impact on 5 key industries. Fortune. Retrieved from http://fortune.com/2014/10/03/the-ebola-outbreaks-impact-on-5-key-industries/
Yakowicz, W. (n.d.). Proof is in the pot: Legal weed gives Colorado business a boost. Inc. Retrieved from http://www.inc.com/will-yakowicz/legal-marijuana-gives-colorado- businesses-a-lift.html

References: Anglen, R. (2014, October 22). Arizona businesses celebrate gay marriage with discounts, deals. AZ Central. Retrieved from http://www.azcentral.com/story/money/business/2014/10/17/ariz-businesses-celebrate- gay-marriage-discounts-deals/17459541/ Burwell, S. M. (2013, November 7). Impacts and costs of the government shutdown. The White House. Retrieved from http://www.whitehouse.gov/blog/2013/11/07/impacts-and-costs- government-shutdown Davis, J. H. (2015, January 13). Obama calls for new laws to bolster cybersecurity. New York Times. Retrieved from http://www.nytimes.com/2015/01/14/us/obama-to-announce-new- cyberattack-protections.html?_r=0 Dillard, S. (2014, January 20). Top 6 technology trends of 2014 that will affect the businesses. Enterprise CIO Forum. Retrieved from http://www.enterprisecioforum.com/en/blogs/sophinadillard/top-6-technology-trends- 2014-will-affect Hoover, K. (2014, June 2). 5 ways the EPA’s power plant rule will affect business. The Business Journals. Retrieved from http://www.bizjournals.com/bizjournals/washingtonbureau/2014/06/5-ways-the-epas- power-plant-rule-will-affect.html?page=all Korte, G. (2015, January 15). Obama to propose paid sick leave for American workers. USA Today. Retrieved from http://www.usatoday.com/story/news/politics/2015/01/14/obama- child-care-paid-leave/21768969/ Lauro, A. (2014, May 19). Retail industry affected by the polar vortex. Go Digital Marketing. Retrieved from http://www.godigitalmarketing.com/retail-industry-affected-polar-vortex- weather/ Snyder, B. (2014, October 13). Ebola outbreak’s impact on 5 key industries. Fortune. Retrieved from http://fortune.com/2014/10/03/the-ebola-outbreaks-impact-on-5-key-industries/ Yakowicz, W. (n.d.). Proof is in the pot: Legal weed gives Colorado business a boost. Inc. Retrieved from http://www.inc.com/will-yakowicz/legal-marijuana-gives-colorado- businesses-a-lift.html