• Social environment is very comprehensive because it may include the total social factors within which an organization operates. • The culture within a society, consists of the cultivated behavior of individuals in that society. • This factor includes people’s attitude to work, health, marriage, religion, education, ethical issues, social responsibility business, etc. • From business point of view, social environment may include expectations of society from business, attitudes of society towards business and its management, views towards achievement of work, views towards customs, traditional and conventions, level of education, etc. • “The forces, factors and institutions with which the businessman has to deal with to achieve its objectives”. • It is the surrounding in which the business exists. • Whenever any businessman is operating or working then he has to interact with the customers, suppliers and he has to perform the transactions within the rules and regulations of the government. • Environment means the surroundings, external objects, influences or circumstances under which someone or something exits. • 1. Events are important and specific occurrences taking place in different environmental sectors. • 2. Trends are the general tendencies or the courses of action along which events take place. • 3. Issues are the current concerns that arise in response to events and treats. • 4. Expectations are the demands made by interested groups in the light of their concern for issues.

1. COMPONENTS
OF
ENVIRONMENT

2. COMPONENTS OF ENVIRONMENT
Legal Social
Economic
Political
Technological

3. SOCIAL
• Social environment is very comprehensive because it
may include the total social factors within which an
organization operates.
• The culture within a society, consists of the cultivated
behavior of individuals in that society.
• This factor includes people’s attitude to work, health,
marriage, religion, education, ethical issues, social
responsibility business, etc.

4. • From business point of view, social environment may
include expectations of society from business,
attitudes of society towards business and its
management, views towards achievement of work,
views towards customs, traditional and conventions,
level of education, etc.

5. POLITICAL
• Political environment refers to the influence exerted
by the three institutions:
1. Legislature: The legislature decides on the particular
course of action.
2. Executive: Government is the executive and its job
is to implement whatever was decided by
parliament.
3. Judiciary: The judiciary has to ensure that both the
legislature and executive function in public interest
and within the boundaries of the constitution.

6. • Political stability impact of factors like civil war, the
declaration of President’s rule, emergency, etc.
• Ideology of ruling government, philosophy of the
political parties, degree and extent of the bureaucratic
delays, red tapism, the question of donation by
business houses to political parties.

7. TECHNOLOGICAL
• The fast changes in the technology creates problem
for enterprises as these render plants and products
obsolete quickly.
• A firm which is unable to cope up with the
technological changes may not survive.
• Therefore, in order to survive in today’s competitive
world, a business has to adopt technological changes
from time to time.

8. • Constant innovation is essential because the purpose
of every business to create a customer, and therefore
every business enterprise has two basic functions i.e.
(a) marketing, and (b) innovation.
• In technological environment, the product remains the
same but the method of performing the function is
always new.
• One of the ways in which product innovation may be
stimulated is by the establishment of research and
development department in the enterprise.
• The research and development are now directed into
computer, sales energy, material science, and laser
technology.