WISH U A GOOD BEGINNING<br />lmothilal@gmail.com - DMS, Pondicherry University<br />
It refers to all External Forces,<br />  	“	 Internal Relationships &<br /> 		“	 Society <br />  Which have impact on the ...
Business Environment<br />Internal Environment<br />External Environment <br />Micro (Task / operations)<br />Macro (Gener...
Internal Environment<br />Promoters’ Values<br />Mission & Objectives<br />Management Structure<br />Internal Power Relati...
Internal Environment<br />Human Resources<br />Internal Relationships<br />Jobs & Wages<br />Human Factor<br />Safe & Hygi...
External Environment - Micro<br />Customers<br />Suppliers<br />Competitors<br />Public <br />Financiers<br />Marketing In...
External Environment - Macro<br />Economic Factors<br />Social & Cultural Factors<br />Demographic Factors<br />Political ...
Introduction - General<br />Various Revolutions<br />Industrial :   <br />Labour Intensive<br />Capital Intensive<br />Gre...
Introduction - General<br />I.T.  (Convergence of Communication Technologies)<br />Knowledge Resolution (Intellectual Capi...
Introduction - General<br />Two Economic Eras<br />Mass Production<br />Customized Production<br />lmothilal@gmail.com - D...
Features of old Economic Era<br />Growth Areas:<br />Energy<br />Transportation<br />Utility<br />Chemicals &<br />Consume...
Features of old Economic Era<br />Growth Rate – 2-3 % p.a.<br />Focus – Natural Resources<br />Important – Physical Assets...
Features of New Economic Era<br />Growth Engines:<br />I.T.<br />Satellites<br />Fiber optics<br />Biotechnology<br />Envi...
Features of New Economic Era<br />Growth Rate – 20-30% p.a.<br />Focus          Knowledge<br />Knowledge Management<br />l...
Features of New Economic Era<br />Important – Physical Assets +<br />  	   Intangible Assets:<br />Example – Japan, Singap...
 Era of Turbulent Change <br />In era of turbulent change, managing change & discontinuity is a key Issue<br />lmothilal@g...
Era of Turbulent Change<br />PDCA    -    PDCA <br />P – Plan<br />D – Development<br />C – Check<br />A – Act<br />lmothi...
Era of Turbulent Change <br />Companies are operating in a war zone of rapidly changing <br />Competitors<br />Technology<...
Era of Turbulent Change<br />Today’s younger generation is coming with new dreams, hopes & aspirations<br />What it needs<...
Era of Turbulent Change<br />Today’s Generation :<br />High Awareness – increased information           Bargaining Power w...
Era of Turbulent Change<br />Demands Variety of Services<br />Wants World Class Quality<br />Tech Savvy<br />Try New Produ...
Era of Turbulent Change<br />Initially companies begin to compete on Cost basis, once companies achieve comparable cost st...
Era of Turbulent Change<br />Key DifferentiatorService<br />		for example:<br />Xerox Corp. (service within 3 Hours anywhe...
Era of Turbulent Change<br />Old Rule is changing:<br />Big will not swallow small but, that FAST who will outpace SLOW<br...
Era of Turbulent Change<br />“ It is not the strongest nor the most intelligent that will survive but the one who is the m...
Era of Turbulent Change<br />Where Indian companies have to focus?<br />Quantum Restructuring <br />Discard Outdated Syste...
Era of Turbulent Change<br />Analysis of Environment:<br />Scanning<br />Monitoring<br />Forecasting<br />Assessment<br />...
Era of Turbulent Change<br />Analyze Environment            SWOT<br />S – Strengths<br />W – Weaknesses<br />O – Opportuni...
Era of Turbulent Change<br />Analyze – Competitive Structure of Industries:<br />Rivalry among existing firms<br />Threat ...
Types of Forecasting<br />Economic: General Economic Conditions<br /><ul><li>GDP Growth Rate
Per Capita Income
Distribution of Income
BOP Trends, Inflation, Rainfall
Climate
Politics – Local & International</li></ul>lmothilal@gmail.com - DMS, Pondicherry University<br />
Economic Environment <br />Nature of the Economy<br />Low Income - Less than $755 of  per capita GNP<br />Middle Income – ...
Economic Environment<br />Structure of the Economy: Components<br />Primary              Agriculture (18% in 2007)<br />Se...
Economic Environment<br />Economic Policies:<br />Industrial Policy<br />Trade Policy<br />Foreign Exchange<br />FDI / FPI...
Economic Environment<br />Economic Conditions:<br />Boom <br />Recession <br />lmothilal@gmail.com - DMS, Pondicherry Univ...
Economic Environment<br />Global Linkages: Membership of WTO, IMF, World Bank, Trade Blocks etc.<br />Magnitude & Nature o...
Economic Environment<br />Economic Systems:<br />Capital Economy<br />Centrally Planned<br />Mixed Economy <br />lmothilal...
Roles of Government - Economic<br />Regulatory<br />Promotional – Infrastructure<br />Entrepreneurial <br />Planning <br /...
Other Roles of Government<br />The Constitution<br />Directive Principles of State Policy<br />Separation of Powers:<br />...
Types of Forecasting<br />2. Social Forecasting:<br /><ul><li>Population Growth / Decline
Age Structure of Population
Migration
Family Life-Style
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Be unit-i

  1. 1. WISH U A GOOD BEGINNING<br />lmothilal@gmail.com - DMS, Pondicherry University<br />
  2. 2. It refers to all External Forces,<br /> “ Internal Relationships &<br /> “ Society <br /> Which have impact on the functioning of business<br />What is Business Environment?<br />lmothilal@gmail.com - DMS, Pondicherry University<br />
  3. 3. Business Environment<br />Internal Environment<br />External Environment <br />Micro (Task / operations)<br />Macro (General / Remote)<br />lmothilal@gmail.com - DMS, Pondicherry University<br />
  4. 4. Internal Environment<br />Promoters’ Values<br />Mission & Objectives<br />Management Structure<br />Internal Power Relationship<br />Company Image / Brand<br />Physical Assets / Facilities<br />R & D / Technological Capabilities<br />lmothilal@gmail.com - DMS, Pondicherry University<br />
  5. 5. Internal Environment<br />Human Resources<br />Internal Relationships<br />Jobs & Wages<br />Human Factor<br />Safe & Hygienic Work Place<br />Security<br />lmothilal@gmail.com - DMS, Pondicherry University<br />
  6. 6. External Environment - Micro<br />Customers<br />Suppliers<br />Competitors<br />Public <br />Financiers<br />Marketing Intermediaries<br />lmothilal@gmail.com - DMS, Pondicherry University<br />
  7. 7. External Environment - Macro<br />Economic Factors<br />Social & Cultural Factors<br />Demographic Factors<br />Political & Government Factors<br />Natural Factors<br />Technological Factors<br />Global Factors<br />lmothilal@gmail.com - DMS, Pondicherry University<br />
  8. 8. Introduction - General<br />Various Revolutions<br />Industrial : <br />Labour Intensive<br />Capital Intensive<br />Green <br />White<br />lmothilal@gmail.com - DMS, Pondicherry University<br />
  9. 9. Introduction - General<br />I.T. (Convergence of Communication Technologies)<br />Knowledge Resolution (Intellectual Capital)<br />lmothilal@gmail.com - DMS, Pondicherry University<br />
  10. 10. Introduction - General<br />Two Economic Eras<br />Mass Production<br />Customized Production<br />lmothilal@gmail.com - DMS, Pondicherry University<br />
  11. 11. Features of old Economic Era<br />Growth Areas:<br />Energy<br />Transportation<br />Utility<br />Chemicals &<br />Consumer Goods<br />lmothilal@gmail.com - DMS, Pondicherry University<br />
  12. 12. Features of old Economic Era<br />Growth Rate – 2-3 % p.a.<br />Focus – Natural Resources<br />Important – Physical Assets (main)<br />Example - Oil Rich Countries<br />lmothilal@gmail.com - DMS, Pondicherry University<br />
  13. 13. Features of New Economic Era<br />Growth Engines:<br />I.T.<br />Satellites<br />Fiber optics<br />Biotechnology<br />Environment <br />Healthcare <br />lmothilal@gmail.com - DMS, Pondicherry University<br />
  14. 14. Features of New Economic Era<br />Growth Rate – 20-30% p.a.<br />Focus Knowledge<br />Knowledge Management<br />lmothilal@gmail.com - DMS, Pondicherry University<br />
  15. 15. Features of New Economic Era<br />Important – Physical Assets +<br /> Intangible Assets:<br />Example – Japan, Singapore, <br /> Hong Kong<br />lmothilal@gmail.com - DMS, Pondicherry University<br />
  16. 16. Era of Turbulent Change <br />In era of turbulent change, managing change & discontinuity is a key Issue<br />lmothilal@gmail.com - DMS, Pondicherry University<br />
  17. 17. Era of Turbulent Change<br />PDCA - PDCA <br />P – Plan<br />D – Development<br />C – Check<br />A – Act<br />lmothilal@gmail.com - DMS, Pondicherry University<br />
  18. 18. Era of Turbulent Change <br />Companies are operating in a war zone of rapidly changing <br />Competitors<br />Technology<br />New Laws<br />Trade Policies <br />Diminishing Customer Loyalty<br />lmothilal@gmail.com - DMS, Pondicherry University<br />
  19. 19. Era of Turbulent Change<br />Today’s younger generation is coming with new dreams, hopes & aspirations<br />What it needs<br />New set of Corporate Response<br />Why ?<br />lmothilal@gmail.com - DMS, Pondicherry University<br />
  20. 20. Era of Turbulent Change<br />Today’s Generation :<br />High Awareness – increased information Bargaining Power will Influence<br />Intelligent & Proactive <br />Higher Standard of Living<br />lmothilal@gmail.com - DMS, Pondicherry University<br />
  21. 21. Era of Turbulent Change<br />Demands Variety of Services<br />Wants World Class Quality<br />Tech Savvy<br />Try New Products & Fickle in brand loyalty<br />More Sensitive<br />lmothilal@gmail.com - DMS, Pondicherry University<br />
  22. 22. Era of Turbulent Change<br />Initially companies begin to compete on Cost basis, once companies achieve comparable cost structure within industry, Focus shifts to<br />Quality then<br />Variety & finally to<br />Responsiveness <br />lmothilal@gmail.com - DMS, Pondicherry University<br />
  23. 23. Era of Turbulent Change<br />Key DifferentiatorService<br /> for example:<br />Xerox Corp. (service within 3 Hours anywhere in U.S.)<br />McDonald's (Courteous)<br />WalMart Store – People Greeter<br />Singapore Airlines – Smile<br />lmothilal@gmail.com - DMS, Pondicherry University<br />
  24. 24. Era of Turbulent Change<br />Old Rule is changing:<br />Big will not swallow small but, that FAST who will outpace SLOW<br />lmothilal@gmail.com - DMS, Pondicherry University<br />
  25. 25. Era of Turbulent Change<br />“ It is not the strongest nor the most intelligent that will survive but the one who is the most responsive to the change” – Charles Darwin<br />Gap between conception of an idea & commercialization has decreased tremendously. <br />lmothilal@gmail.com - DMS, Pondicherry University<br />
  26. 26. Era of Turbulent Change<br />Where Indian companies have to focus?<br />Quantum Restructuring <br />Discard Outdated Systems<br /> ( e.g. E- Governance in Administration)<br />Focus on Customer centricity<br /> (Blow Up)<br />lmothilal@gmail.com - DMS, Pondicherry University<br />
  27. 27. Era of Turbulent Change<br />Analysis of Environment:<br />Scanning<br />Monitoring<br />Forecasting<br />Assessment<br />lmothilal@gmail.com - DMS, Pondicherry University<br />
  28. 28. Era of Turbulent Change<br />Analyze Environment SWOT<br />S – Strengths<br />W – Weaknesses<br />O – Opportunities<br />T – Threats<br />lmothilal@gmail.com - DMS, Pondicherry University<br />
  29. 29. Era of Turbulent Change<br />Analyze – Competitive Structure of Industries:<br />Rivalry among existing firms<br />Threat of new entrants<br />Bargaining power of suppliers & buyers<br />lmothilal@gmail.com - DMS, Pondicherry University<br />
  30. 30. Types of Forecasting<br />Economic: General Economic Conditions<br /><ul><li>GDP Growth Rate
  31. 31. Per Capita Income
  32. 32. Distribution of Income
  33. 33. BOP Trends, Inflation, Rainfall
  34. 34. Climate
  35. 35. Politics – Local & International</li></ul>lmothilal@gmail.com - DMS, Pondicherry University<br />
  36. 36. Economic Environment <br />Nature of the Economy<br />Low Income - Less than $755 of per capita GNP<br />Middle Income – ( $756 - $2995)<br />High Income – ($9266 & Above)<br /> ( of year 2000)<br />lmothilal@gmail.com - DMS, Pondicherry University<br />
  37. 37. Economic Environment<br />Structure of the Economy: Components<br />Primary Agriculture (18% in 2007)<br />Secondary Industry ( <br />Tertiary Service (<br />lmothilal@gmail.com - DMS, Pondicherry University<br />
  38. 38. Economic Environment<br />Economic Policies:<br />Industrial Policy<br />Trade Policy<br />Foreign Exchange<br />FDI / FPI<br />Monetary<br />Fiscal - Public Expenditure & Revenue<br />lmothilal@gmail.com - DMS, Pondicherry University<br />
  39. 39. Economic Environment<br />Economic Conditions:<br />Boom <br />Recession <br />lmothilal@gmail.com - DMS, Pondicherry University<br />
  40. 40. Economic Environment<br />Global Linkages: Membership of WTO, IMF, World Bank, Trade Blocks etc.<br />Magnitude & Nature of cross border Trade<br />Financial Flows – FDI / FPI<br />Extremism: <br />Terrorism – within & Cross border<br />Unsocial elements<br />Fanaticism <br />lmothilal@gmail.com - DMS, Pondicherry University<br />
  41. 41. Economic Environment<br />Economic Systems:<br />Capital Economy<br />Centrally Planned<br />Mixed Economy <br />lmothilal@gmail.com - DMS, Pondicherry University<br />
  42. 42. Roles of Government - Economic<br />Regulatory<br />Promotional – Infrastructure<br />Entrepreneurial <br />Planning <br />lmothilal@gmail.com - DMS, Pondicherry University<br />
  43. 43. Other Roles of Government<br />The Constitution<br />Directive Principles of State Policy<br />Separation of Powers:<br />Union List<br />State List<br />Concurrent List (1&2)<br />lmothilal@gmail.com - DMS, Pondicherry University<br />
  44. 44. Types of Forecasting<br />2. Social Forecasting:<br /><ul><li>Population Growth / Decline
  45. 45. Age Structure of Population
  46. 46. Migration
  47. 47. Family Life-Style
  48. 48. Social Attitude</li></ul>lmothilal@gmail.com - DMS, Pondicherry University<br />
  49. 49. Demographic Environment<br />Age Structures<br />Gender <br />Family Size<br />Family Life-Cycle <br />Single <br /> Married<br /> With / Without Children<br />lmothilal@gmail.com - DMS, Pondicherry University<br />
  50. 50. Demographic Environment<br />Occupation<br />Education<br />Social Class<br />Religion<br />Nationality<br />Urban / Rural<br />lmothilal@gmail.com - DMS, Pondicherry University<br />
  51. 51. Types of Forecasting<br />3. Political Forecasting:<br />Political Alliances<br />Political Ideologies <br />Political Leadership<br />lmothilal@gmail.com - DMS, Pondicherry University<br />
  52. 52. Political Environment<br />Policies of Political Parties<br />Nature of the Constitution<br />Govt. System:<br />Parliamentary Democracy <br />Presidential Democracy<br />lmothilal@gmail.com - DMS, Pondicherry University<br />
  53. 53. Types of Forecasting<br />4. Technological Forecasting:<br />Innovations:<br />Radical / Incremental / <br />Next Generation<br />Place & Extent of Diffusion<br />Pace <br /> (Future shock)<br />lmothilal@gmail.com - DMS, Pondicherry University<br />
  54. 54. Technological Forecasting<br />Technological Leadership & Followers<br />Transfer of Technology<br />Appropriate Technology & Adaptation <br />First mover Advantages & Disadvantages<br />Sustainability of the lead<br />lmothilal@gmail.com - DMS, Pondicherry University<br />
  55. 55. Natural Environment<br />Geographical Factors:<br /> ( e.g. interplanetary explorations & motives beyond them - commercial Exploitation )<br />Ecological Factors<br />lmothilal@gmail.com - DMS, Pondicherry University<br />
  56. 56. In view of constant changewhat should company do?<br />Customer Needs & Expectations<br />Demand Conditions<br />Substitutes<br />Govt. Policy<br />Social Forces<br />Competitive Dynamics<br />Innovations by R&D Labs<br />Manage cross-cultures<br />lmothilal@gmail.com - DMS, Pondicherry University<br />
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