The document discusses the business environment and its key components. It states that each business operates within a unique environment that influences and is influenced by the business. It also notes that facets of business are changing more rapidly in the new economy compared to earlier years. The document outlines the micro and macro environment, including factors such as consumers, competition, and technological, economic, cultural, social, and political conditions that comprise the overall business environment.

1. BUSINESS ENVIRONMENT-INTRODUCTION
V.Madhusudhan Goud
Assistant Professor
Department of Management Studies
GPCET, Kurnool

2. “It is not the strongest of the
species that survive, nor the
most intelligent, but the one
most responsive to change”
Charles Darwin
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V.Madhsudhan Goud, Assistant Professor,
GPCET
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3. Each business organization operates in
its unique environment.
Environment influences businesses and
also gets influenced by it.
In the new economy the facets of
business are rapidly changing as
compared to the earlier years
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V.Madhsudhan Goud, Assistant Professor,
GPCET
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4. What do you mean by
Business?
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V.Madhsudhan Goud, Assistant Professor,
GPCET

5. An organized
efforts of
enterprise to
supply
consumers
with goods
and services
for a profit.
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V.Madhsudhan Goud, Assistant Professor,
GPCET
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6. CHARACTERISTICS OF BUSINESS
• Pressure of
Competition
• Transition
Technology Information
Dynamic Complex
• Immense • Globalization
Opportunities
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V.Madhsudhan Goud, Assistant Professor,
GPCET
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7. BUSINESS OBJECTIVES
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GPCET
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Power
Quality
Products
& Services
Growth Service to
Business
Goals
Market
Leadership
Creation
Profit
Employee
Satisfaction &
Development
Joy of
Creation

8. COMPONENTS OF BUSINESS ENVIRONMENT
Firm
Micro
Environment
Macro
Environment
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V.Madhsudhan Goud, Assistant Professor,
GPCET
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9. Micro
Environment
Macro
Environment
Environmental
Scanning
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V.Madhsudhan Goud, Assistant Professor,
GPCET

10. MICRO ENVIRONMENT
Consumers
Competition
Employees
Government
Suppliers
Intermediaries
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V.Madhsudhan Goud, Assistant Professor,
GPCET
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11. MACRO ENVIRONMENT
 Demographic Environment
 Economic Environment
 Political Environment
 Socio-Cultural Environment
 Technological Environment
 Global Environment
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V.Madhsudhan Goud, Assistant Professor,
GPCET
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12. CULTURAL ENVIRONMENT
 Includes
 Attitude of the people to work, wealth, family,
marriage, religion, education, ethics, human
relations, social responsibilities.
 Culture is defined as “the thought and behavior
patterns that member of a society learns through
language and other forms of symbolic
interaction-their customs, habits, beliefs and
values, which binds together as a social entity
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V.Madhsudhan Goud, Assistant Professor,
GPCET
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13. CHARACTERISTICS OF CULTURAL ENVIRONMENT
 Prescriptive
 Socially shared
 Cumulative
 Dynamic
 Time & Culture
 Space & Culture
 Culture & agreement
 Culture & superstition
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V.Madhsudhan Goud, Assistant Professor,
GPCET
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14. SOCIAL ENVIRONMENT
Aspects of S.E are……….
 Religion
 Family System
 Communication
 Christianity
 Islam
 Hinduism
 Buddhism-right speech, action, seeing, thinking, living,
effort, mindfulness, and meditation.
 Confucianism-right action for attaining of salvation.
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V.Madhsudhan Goud, Assistant Professor,
GPCET
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15. Technology
Environment
Product
Orientation
Process
Orientation
Service
Orientation
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GPCET
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16. Characteristics:
 Technology transfer
 Technology transfer as innovation
 Technology and location of plants
 Information Technology and Globalization-CAD,
CAP
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V.Madhsudhan Goud, Assistant Professor,
GPCET
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17. ECONOMIC ENVIRONMENT
 Major changes:
 Capital flow rather than product or trade flow
 Establishment of production facilities in various
countries
 Technological revolution
 Primary products delinked from the industrial
economies
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GPCET
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18. 11/11/2014
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V.Madhsudhan Goud, Assistant Professor,
GPCET
Capitalistic Mixed Communistic

19. POLITICAL ENVIRONMENT
1.Democracy
2.Totalitarianism---a) Theocratic
b) Secular
 Religious leaders also assumes the roles of political
leaders and rules the country in theocratic
totalitarianism. Eg: Iran
 One or a group of leaders or a single political party
without aligning with any religions assumes the power
and rule the country with military force under secular
totalitarianism.
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V.Madhsudhan Goud, Assistant Professor,
GPCET
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20. TYPES OF POLITICAL RISKS
 Two Party System. Eg: USA –Republican represents
business interest and Democratic represents the
labour.
 Multi –Party System.
 Single party system
Political Risks:
1. Confiscation
2. Expropriation
3. Nationalization
4. Domestication
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V.Madhsudhan Goud, Assistant Professor,
GPCET
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21. LEGAL ENVIRONMENT
 Common Law: according to the situations and
incidents
 Civil Law: according to the facts
 Theocratic Law: based on religious precepts of
Islam Law and Hindu Law.
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V.Madhsudhan Goud, Assistant Professor,
GPCET
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22. 11/11/2014
Thank you
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V.Madhsudhan Goud, Assistant Professor,
GPCET