Contemporary Development in Business Management: Business Environments

Topics: Management, Environment, Economics Pages: 5 (896 words) Published: September 14, 2013
Learning Outcomes
Analyze business environments in terms of transformation systems and internal and external environments Identify the most relevant elements of the business environments using PESTLE analysis and Porter’s five forces model Discuss the classical, human relations and systems approaches to organizations Describe and compare the various structures that may be used within organizations. The business as a transformation system

Transformation Process: Businesses utilize the inputs in order to produce the outputs. Types of Environments
A simple/static environment is the easiest to analyse. A detailed, systematic, historical analysis is probably sufficient in order to understand it. University of Sunderland

Contemporary Developments In Business

Unit 1:
Introduction To The Business Environment
In a dynamic environment, all aspects of the environment are subject to change. When changes are rapid or sudden, such environments are referred to as turbulent. Complex environments are becoming more and more common in modern times. Technology, markets, politics, etc. are becoming more difficult and more involved

The Organization’s Environment
PESTEL Factors

PESTEL Analysis
Socio - Cultural

Political Environment
Government policy affects the whole economy and governments are responsible for enforcing and creating a stable framework in which businesses can operate in. The quality of government policy is important in providing the right Physical infrastructure (transport etc), Social infrastructure (education, welfare net etc) and Market infrastructure (enforceable contracts) Businesses must forecast the likely impact of a change in the political environment. Inter-country relationships/attitudes

Government leadership
Trading Policies
Economic Environment
Socio/Cultural Environment
Technological Environment
Technology refers to the equipment, technique or organization. It is concerned with the impact of technology on the market. Technology can increase total output and so contribute to overall economic growth through gains in productivity, reduced costs and new types of product Global Communication e.g. Amazon, Competing Technology developments Effect of technological change on Organizations:

The type of products or services that are made and sold
The way in which products are made (robots, new raw materials) The way in which services are provided
The means and extent of communications with external clients e.g. e-mail, website

Changing attitudes to the environment
Energy consumption
Waste disposal
Legislation on environmental factors
Green Marketing - is the marketing of products that are presumed to be environmentally safe. It incorporates a broad range of activities, including product modification, changes to the production process, packaging changes, as well as modifying advertising Legal Environment

Legal Factors affecting all Companies
General legal framework: contract, – Basic ways of doing business, negligence proceedings Criminal Law – Theft, Insider trading, bribery, money laundering Company Law – Directors and their duties, insolvency, shareholder’s rights Employment Law – Trade Union recognition, minimum wage, unfair dismissal Health & Safety – Safety procedures, fire precautions

Data Protection – Copyright laws
Marketing & Sales – Consumer laws, integrity in advertising Environment – Pollution control, waste disposal
Tax law – Corporation Tax, VAT, PAYE
Competitive Regulations – Is the industry open or regulated?

Porter’s Five Forces
Approaches to Organizations
The Classical Approach.
The classical school of organization theorists comprises of those with the view that there is a single set of principles of organization which once discovered, would be the key to the best way of structuring...
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