The document discusses the business environment and its various components. It states that the business environment refers to external forces outside a business's control that can impact its performance. These include the social, legal, economic, political and technological environments, commonly known as the SLEPT framework. Each of these environments are further defined. The business environment is described as the totality of external forces, both specific and general, that are interrelated, dynamic, uncertain and complex. Understanding the business environment helps businesses identify opportunities and threats to improve performance.

1. Madan Kumar
M.A.,M.A.,B.Ed.,M.Phil.,M.B.A.,

2.  Business environment refers to the total of all
individuals, institutions and other forces that
are outside the control of a business
enterprise but that may affect its
performance
Madan Kumar
M.A.,M.A.,B.Ed.,M.Phil.,M.B.A.,

3. Madan Kumar
M.A.,M.A.,B.Ed.,M.Phil.,M.B.A.,
political

4. S.L.E.P.T
 Social environment
 Legal environment
 Economic environment
 Political environment
 Technological environment
Madan Kumar
M.A.,M.A.,B.Ed.,M.Phil.,M.B.A.,

5.  Social environment includes social forces like
custom and traditions, values, social trends
and society’s expectation from business
Madan Kumar
M.A.,M.A.,B.Ed.,M.Phil.,M.B.A.,

6.  Attitudes towards product innovations, lifestyles
and consumer preferences
 Concern with quality of life
 Life expectancy
 Expectations form the workforce
 Shifts in the presence of women in the workforce
 Birth and death rates
 Population shifts
 Educational system and literacy rates
 Consumption habits
 Composition of family
Madan Kumar
M.A.,M.A.,B.Ed.,M.Phil.,M.B.A.,

7.  Legal environment includes various
legislations passed by the government
authorities, court judgments and the
decisions endeared by various commissions
and agencies at every level of the government
Madan Kumar
M.A.,M.A.,B.Ed.,M.Phil.,M.B.A.,

8.  Economic environment refers to factors like
interest rates, inflation rates and changes in
disposable income of people etc.,
Madan Kumar
M.A.,M.A.,B.Ed.,M.Phil.,M.B.A.,

9.  The rate of growth of GDP and per capita income
at current and constant price
 Rates of saving and investment
 Volume of imports and exports
 Balance of payment and changes in foreign
exchange reserves
 Agricultural and industrial production trends
 Expansion of transportation and communication
facilities
 Money supply in the economy
 Public debt
 Planned outlay in private and public sectors
 Existing structure of the economy
Madan Kumar
M.A.,M.A.,B.Ed.,M.Phil.,M.B.A.,

10.  Political environment includes political
conditions such as general stability and peace
in the country and specific attitudes that
elected government representatives hold
towards business
Madan Kumar
M.A.,M.A.,B.Ed.,M.Phil.,M.B.A.,

11.  The constitution of the country
 Prevailing political system
 Dominant ideologies and values of major political
parties
 Political ideology an practices of the ruling party
 The nature and profile of political leadership and
thinking of political personalities
 The level of political morality
 The extent and nature of government intervention in
business
 Political institutions like the government and allied
agencies
 The nature of relationship of our country with foreign
country
Madan Kumar
M.A.,M.A.,B.Ed.,M.Phil.,M.B.A.,

12.  Technological environment of business
includes forces relating to scientific
improvements and innovations which provide
new ways of producing goods and services
and new methods and techniques of
operating a business.
Madan Kumar
M.A.,M.A.,B.Ed.,M.Phil.,M.B.A.,

13.  Totality of all external forces
 Specific and general forces – specific forces
(investors, customers, competitors and
suppliers) general forces (economic, social,
political, legal and technological conditions)
 Inter – related
 It is dynamic
 It is uncertain
 It is complex
 It is a relative concepts
Madan Kumar
M.A.,M.A.,B.Ed.,M.Phil.,M.B.A.,

14.  It helps to identify opportunities and getting the first
mover advantages instead of losing them to the
competitors
 It helps to identify threats on time which serves as an early
warning signal
 It helps in assisting in planning and policy formulation
 It helps in tapping useful resources so that the enterprise
can convert them into output that the environment desires
 it helps in coping with rapid changes in an increasingly
dynamic environment
 It helps in improving performance by continuously
monitoring the environment and adopting suitable
practice
Madan Kumar
M.A.,M.A.,B.Ed.,M.Phil.,M.B.A.,

15.  Liberalization :
It means removal of unnecessary controls and
restrictions on business ( abolishing licensing
requirement, freedom in deciding the scale of
business, freedom in fixing the prices,
reduction in tax rates, simplifying procedures
for imports and exports, making it easier to
attract foreign capital , etc.,)
Madan Kumar
M.A.,M.A.,B.Ed.,M.Phil.,M.B.A.,

16.  Privatization :
It means giving greater role to the private
sector in the nation building process and a
reduced role to the public sector.
(Disinvestment)
Madan Kumar
M.A.,M.A.,B.Ed.,M.Phil.,M.B.A.,

17.  Globalization :
It means integrating the various economies of
the world leading towards the emergence of a
cohesive global economy ( removal of
quantitative as well as tariff restrictions, import
liberalization and export promotion through
rationalization of the tariff structure and
foreign exchange reforms)
Madan Kumar
M.A.,M.A.,B.Ed.,M.Phil.,M.B.A.,

18.  It is the act of the government in cancel the
legal tender status of a currency unit in
circulation. The aim of demonetization was to
curb corruption , especially the accumulation
of black money generated by income that has
not been declared to the tax authorities
Madan Kumar
M.A.,M.A.,B.Ed.,M.Phil.,M.B.A.,

19.  Demonetization is a tax administration
measures. People with black money had to
declare their unaccounted wealth and pay tax at a
penalty rate.
 Demonetization is a measures to improve tax
compliance as tax collection increased because
of increased disclosure
 demonetization led to channelizing more
savings through the formal financial system.
Bank deposits increased
 Demonetization aimed to create a less-cash or
cash-lite economy. Cash transactions declined.
Digital transactions using Rupay cards and debit
cards etc. ., increased.
Madan Kumar
M.A.,M.A.,B.Ed.,M.Phil.,M.B.A.,

20.  Increasing competition
 More demanding customers
 Rapidly changing technological environment
 Necessity for change
 Need for developing human resource
 Market orientation
 Loss of budgetary support to the public
sector.
Madan Kumar
M.A.,M.A.,B.Ed.,M.Phil.,M.B.A.,

21.  Philips, a company manufacturing light bulbs
incurred heavy expenditure on scientific research
and development and discovered a technology
that made it possible to produce an energy
efficient light bulb that lasts at least twenty times
as align as a standard bulb. It resulted in growth
and profitability of the company.
1. Identify and explain the dimension of business
environment
2. State the point of importance of business
environment mentioned above by quoting the
lines .
Madan Kumar
M.A.,M.A.,B.Ed.,M.Phil.,M.B.A.,

22. 1. Technological environment (explain also)
2. Business environment helps a firm to
improve its performance. “it resulted in
growth and profitability of the company”
Madan Kumar
M.A.,M.A.,B.Ed.,M.Phil.,M.B.A.,

23. Madan Kumar
M.A.,M.A.,B.Ed.,M.Phil.,M.B.A.,