2. Study Focus
• The Business Organisation
• The Business Environment
• The Macro-Economic Environment
• Micro-Economic Factors
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3. Business Organisations & Their
Stakeholders
• An Organisation
– A Social Arrangement which pursues collective
goals, which controls its own performance and
has a boundary seperating it from its
environment
– Organisations achieve results which individuals
cannot on their own
– Different types of organisations with in
different industries
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4. • Stakeholders goals & objectives
– Stakeholders are individuals/groups that have a
potential interest in the organisation
– Internal Stakeholders – Connected
– External Stakeholders
– Stakeholder Mapping – Power & Interest
• Mandelow suggests stakeholders may be positioned
on a matrix showing their interest in the
organisation
• How to Measure Stakeholder Satisfaction
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5. The Business Environment
• Analysing the Business Environment
– Whatever the overall strategic management
method used, no organisation is likely to achieve
its aims if it fails to take into account the
characteristics of the environment in which it
operates in.
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6. • Step 1 – Assess the nature of the
environment
• Step 2 – Identify those influences which
have affected the organisation in the past
or which are likely to do so in the future
• Step 3 – Prepare a structural analysis
identifying the key factors at work in the
immediate or competitive environment
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7. We can now ask the following questions:
• Step 4 – What is the organisations position
in relation to other organisations
• Step 5 – what threats and/or opportunities
are posted by the environment
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8. The tools to help us to assess our organisation, the
environment and seek options
• PEST Analysis – Political, Economic, Social & Technological
• SWOT Analysis – Strengths, Weaknesses, Opportunities &
Threats (Internal & External)
• The Value Chain: - a birds eye view of the organisation and
what it does. It describes those activities within the org
that add value to the purchased inputs. Linkages are
relationships between activities
• Porter’s Five Forces – Barriers to entry, substitute
products, bargaining power of customers, bargaining
power of suppliers, competitive rivalry. (Competitive
Advantage)
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9. The Macro Economic Environment
This is the study of totalling affects of decisions of businesses by
looking at a compete national or international economic
system as a whole.
There is a circular flow of income in an economy, which means
that expenditure, output and the income all have the same
total. (Closed & Open Economies)
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10. Micro Economic Factors
• This refers to the immediate operational
environment including suppliers, competitors,
customers and stakeholders
– Supply & Demand – the relationship between the
business and Suppliers & Customers
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The Business Organisation
& Environment