business environment what is – what’s called a business environment? see the following continuation

Topic – business environment what is

A. Understanding the Business Environment

The surroundings may be interpreted as all elements that may be interconnected and affect one another using circumstances and activities. The environment consists of physical and nonphysical elements. Available world, physical elements such as for example technology, natural conditions and suppliers while non-physical elements may be in the proper execution of community customs, economic conditions and norms.

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business environment what is

Business includes all activities and businesses to produce a profit by providing the products and services required for the economic system. The essence of any business venture is the exchange between the client and the seller.

From the aforementioned two definitions we are able to draw the conclusion that the comprehension of the Business Environment are factors that could affect directly or indirectly the management of the organization or business activities.

B. Division of Business Environment

business environment what is – Organizational environments could be distinguished over external environments and internal environments. The external environment contains factors that affect the business from away from boundaries of the business, while the inner environment includes factors within the organization that affect the management of the organization.

The external environment of an organization is generally distinguished over the general environment and a special environment (also called an activity environment) that includes suppliers, customers, competitors, regulators, and unions. Meanwhile, the inner environment includes factors of mission vision, corporate culture, management style, organizational policy, employees, inter-divisional relationships, and informal organizations.

C. External and Internal Environmental Relations with Organizations

External environment as a source for suppliers of resources and consumers of output. Just how much this environment can support an organization may have a direct effect on the organization’s operations and performance. A great relationship with suppliers will further ensure a smooth influx of needed resources and satisfied customers will support demand for items and services produced.

The internal environment directly affects the amount of capability in the act which include all three subsystems in the organizational system, namely input, transformation, and output.

D. General Environment

The typical environment includes background conditions in an additional environment that could have a significant effect on the operational activities of an organization. These environments include:

Economic Conditions

Namely the typical condition of the economy related to interest rates, inflation, currency konvertibility, per capita income level, gross domestic policy, monetary and fiscal policy, tax system, population, unemployment, wage level and other related economic indicators.

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Socio-Cultural Conditions

The general condition of the prevailing social values concerning human rights, customs, norms, values, beliefs, languages, attitudes, behaviors, languages, religions, tastes, aspirations, educational tend and related social institutions.

Legal Conditions – Politics

Namely political ideology, party and political orgnization, kinds of government, hokum, government laws and regulations that affect business transactions, agreements with other Countries, patents and trademarks.

Technological Conditions

That’s the typical condition of the development and option of technology in the surroundings, including the advancement of science.

Natural Environmental Conditions

It is just a common condition of nature and physical environmental conditions.

The difference in these related factors is likely to be very noticeable for organizations operating internationally. The conditions in the general environment differ a whole lot in one single Country with another. Successful managers of organizations operating internationally can understand these differences and assist the corporation for making the necessary operational adjustments.

E. Special Environment

A unique environment contains organizations, groups, actual individuals with whom an organization must interact to be able to operate and thrive. Once called a job environment, this environment is different for every single organization, with respect to the unique operating situation and domain of the organization.
Important elements in a organization’s specific environment include:


That is, certain groups of people and consumer organizations or customers who buy goods from organizations and or use their services.


Certain human resources, information and finances and raw materials are expected by the corporation to operate.


Certain organizations offer the exact same or similar goods and services to the same number of consumers or customers.

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Government agencies or representatives at the local, regional and central levels as hokum penegsk and perturan that affect the operational activities of the organization.

Trade Unions

It is an organization that gathers workers to fight for the aspirations of its members.

F. Internal Environment

They’re factors within the organization that affect the management of operations. The influence of the interior environment on the organization may be briefly ed the following:
Vision is defined being an breakdown of the problem or portrait for the future (long term) that the organization will go to. Meanwhile, there is a statement in regards to the intent and philosophy of the business or the explanation for packing an existing orgaization. Each level of management must fully know what the vision and mission of the organization is.

Corporate Culture

Culture is really a system of mutual values, beliefs, and habits inside an organization that interacts with formal structures that produce behavioral norms within the organization. It is the social and psychological climate of corporate ebuah, and its existence is an open or open culture. In a closed culture the sentness of cendrung is produced by a advanced level of management. Managers lack trust in subordinates, plenty of secrecy across the organization’s ranks, and employees are not compelled to be creative or participate in problem solving. Conversely, in an open culture decisions are manufactured at a lesser degree of management, trust in subordinates or employees is considerable and employees are encouraged to be keatif and contained in problem solving.

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Management style

The attitude and preferentiality of the boss affects what sort of task is carried out. The issue may be if the managerial design of the larger manager is different from the lower level manager. Generally speaking, lower-level managers have to regulate to the style of the boss.


The policy sets limits as a limitation as a result of earning decisions. Policies produced by lower-level managers should really be aligned with those of higher managers. Policies in many cases are designed to ensure consistency used such as for example when and how performance is assessed.


Employees vary from individual to individual in various ways such as proficiency, attitude, personal goals, and personality. As a result, an effective manager’s behavior by having an employee may not be effective with another employee. In extreme cases employees may change from one another making it extremely difficult to handle as a group. In order to work, managers must consider differences, both individual and group.

Informal organizations

Members of the business will encounter two types of organizations within the company, namely formal and informal.Formal organization is indicated by an information of organizational structures and job descriptions. Informal organizations are evolving relationships and patterns of human interaction within organizations that are not officially defined. Informal organizations might have a confident or negative effect on the length of their activities.

Relationships between units

Managers must properly understand the partnership between existing divisions or departments and must make the most of those relationships. If the job of a division is dependent upon another division in the flow of work, then your manager must realize that cooperation with other divisions is urgently needed if the job will be completed efficiently or the productivity of the division really wants to be improved.

G. Environment and Competitive Advantage

In accordance with Schermerhorn (1996), management’s attention in dealing with complex and constantly changing external environments is increasingly centered on the concept of competitiveness. Competitive advantage is defined as a particular advantage that allows the corporation to handle market and environmental forces a lot better than its competitors.


No organization is immune to the influence of economic factors. More and more today, competition to hunt down consumers and get rare resources is getting harder and more merciless. Managers should direct companies to compete and win them, both at any given time once the economy is in recession and once the economy is growing.
Therefore today’s managers must understand and follow and be tuned in to the development of the entire world economy. Corporate leaders now realize that competitive excellence must be performed with full understanding, both on issues and opportunities from the international dimension in management.

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Socio-cultural issues

business environment what is – Any manager who talks about the excellence of competitiveness must acknowledge the significance of people. This pertains to commitment and effort in using organizational resources which will determine the highest amount of performance achievement. Good managers realize that talented and diligent workers are necessary to the excellence of long-term competitiveness. A manager should also make good decisions when recruiting and selecting workers from labor sources, both externally and internally.

Legal-political aspects

All efforts created by managers to pursue competitive advantage must be done in manners that are in respect with the expectations of town, namely to uphold ethics and social responsibility, and to be within the framework of hokum and government regulations that support those expectations.
Managers may also be required to learn various laws and regulations at the district, provincial and national levels including related government agencies. Organizations operating internationally will face greater complications since the laws and regulations vary from country to country.

Technology aspects

Today, we live and work in a century of information technology. Specifically for managers, the usage of technology and information is just a key theme of daily life. Computer and information technology continues to expand its influence on manufacturing and service processes. People feel that the excellence of competitiveness through technology is a key driver for the organization next few years.
It should be acknowledged that the rapid ness of technology brings about a variety of changes that continue in the wider community. As managers, employees and consumers we should strive to continue to check out and understand every step of development and change.


Environmental issues rank second highest on social priorities after education. The results of the survey show that the company world must take a dynamic role in assisting to fix environmentally friendly problems which can be now facing the world community. Business leaders and pogresive governments recognize a large amount of the world’s industries rely on natural resources for the base of the products it produces. They understand the huge possibility of green marketing involving the sale of environmentally friendly products.


The business environment has a huge impact on the business’s operations and organizational management. For a manager this becomes both the opportunity and a challenge. The ever-changing environment requires management and organizations to be responsive and progressive.
So widespread and kopleksnya the environment faced with a company demands professionalism out of every human resource that exists in the company. Managers must always match the flow of modernity, mastering technology and information in order to gain a competitive edge.
Organizations that do not desire to constantly learn gradually will experience setbacks and deaths from losing competition meets the demands of the market.

That is expanation about business environment what is, hopefully useful

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