Organic Name Reactions for the students and aspirants of Chemistry12th.pptx
Bba103 ppt-unit-01
1. Program
Programme : BBA
Semester: One
Subject Code: BBA103
Subject Name: Business Environment
Unit Number: 1
Unit Title : Business Environment: An Introduction Structure:
2. Program
Introduction
Generally speaking, an environment includes the air we
breathe, the water we drink, the available business, social and
educational infrastructure in the locality, state and country
Environment means the environment that affects business,
be it external or internal. Managers must understand the
impact of these forces on the business.
The environment may be based on economic and non
economic factors.
3. Program
Objectives:
recognize the concept of business and the role of business
organizations.
state the nature of the ‘internal’ environment of business.
construct analysis tools such as SWOT to examine the business
environment.
identify how business managers respond to changing
environmental factors.
4. Program
Concept of Business
what is business?
Let us understand three basic propositions that form an
integral part of a business:
Business is an economic activity.
A business firm is an economic unit.
Business decision making is an economic process.
5. Program
Most important decisions for a successful business are:
What business am I in?
Who are my target customers?
Where/When/ How to do the business?
Do I expand?
If yes, where and by how much?
6. Program
Levels of Business Environment
Based on time, we may talk of the past, the present and
the future environment of business. Based on space, we may
think of local, regional, national and international environment
of business.
Based on forces, we can distinguish between market and
non-market environment of business.
Based on the economic or non economic factors we may
specify economic and non economic environment of
business.
7. Program
Internal environment
The internal environment is essentially all the factors that can
be controlled by the organization. These factors are usually
things like technology advancement, e-commerce,
andbusiness expansion.
The factors that constitute the internal environment:
Value System
Vision, Mission and Objectives
Management Structure and Nature
Internal Power Relationship
Human Resources
Company Image and Brand Equity
8. Program
External environment
The external environment is a set of complex, rapidly
changing and significant interacting institutions and forces
that affect the organization's ability to serve its customers.
External forces are not controlled by an organization, but they
may be influenced or affected by that organization.
The external environment covers part of the organization,
which usually cannot be controlled within the organization and
includes such factors as social, legal, technological and
political factors
9. Program
The internal and external environments are depicted in figure:
Business Environment
EXTERNAL
MICRO
INTERNAL
MACRO
Promoters
objective
management
power
relationship
Brand image
assets R&D
Human
resources
marketing
capabilities
Customers
suppliers
Competitors
Financiers
Marketing
intermediaries
Market
Economic
Social
Demographic
political Natural
Technological
Global
11. Program
External Macro Environment
Economic environment
Technological environment
Political and legal environment
Demographic environment
Social / cultural environment
Ecosystem environment
Global environment
12. Program
Understanding the Environment
The manager’s job cannot be accomplished in a vacuum within the
organization the manager to understand and evaluate the impact of
the business environment due to the following reasons
restrictive business environment
present and future viability
The cost of capital and the cost of borrowing
availability of all key inputs
Increasing public awareness
opportunities for growth and profits
13. Program
SWOT analysis
A SWOT analysis (analysis of the strengths and weaknesses
of the organization and opportunities and threats in the
environment)
A SWOT analysis should not only result in the identification of
a firm’s core competencies, but also the identification of
opportunities that the firm is not currently able to take
advantage of, due to a lack of appropriate resources.
14. Program
We need to follow certain steps in order to do this analysis
Step – 1: Assess your market
Step – 2: Assess your company
Step – 3: Assess your competition
Step – 4: Opportunity
Step – 5: Identify the threats
Step – 6: Internalanalysis
Step – 7: External analysis
15. Program
What business managers should do?
In order to understand the business environment. Firstly
Focus on your strengths.
Shore up your weaknesses.
Capitalize on your opportunities.
Recognize your threats.
Now identify
Against whom do we compete?
Who are our most/less intense competitors?
Who are the potential competitive entrants? What are their
barriers to entry?
16. Program
Next evaluate
What are their objectives and strategies?
What is their cost structure? Do they have a cost advantage or
disadvantage?
What are the strengths and weaknesses of each competitor?
Size and growth
Profitability
Cost structure
Distribution systems
Market trends
18. Program
Student Activity:
Disturbances in the environment may spell profound threats or
new opportunities. As successful organization will identify,
appraise, and respond to the various opportunities and threats
in its environment. Discuss a recent example where
environment posed threat or opportunities
Editor's Notes
The reversal of the trends in the export growth during 1990-91, and thereafter, required a massive export thrust. Since July 1991 the Government of India initiated the process of economic reforms aimed at globalization and liberalization of Indian economy. A number of policy changes were announced leading to the declaration of the Export-Import Policy 1992-97. This policy brought about all round liberalization of exports and imports Besides, under the Liberalized Exchange Rate Management System (introduced as a result of the simplification of the foreign exchange law and procedures), the entire amount of export proceeds can now be converted into Indian rupees at the market determined rate of exchange.
The year 1998-99 was the worst year for India’s exports with exports recording a negative rate of growth of 3.9%. The decline in exports was caused mainly due to recession in global trade, fall in prices in the international market, infrastructural bottlenecks, introduction of strict sanitary and phyto-sanitary standards by developed countries and so on. This trend continued and exports recorded the growth rate of 11% for the year 1999-2000 followed by 20% for year 2000-2001. However, the export performance for the year 2001-02 was very disappointing as the growth in exports was meager at 0.6% over the same period in the previous year. a renewed attempt by the Export-Import Policy 2002-07 to promote exports so as to increase India’s exports from the level of USD 44.56 bn. (2000-01) to USD 88 bn. by the end of 2006-07 to achieve 1% share of the global merchandise trade
Most nations publish their balance of payments figures monthly, quarterly and annually. The accounts themselves show the structure of a nation’s external trade, its net position as an international lender or borrower, and trends in the direction of its economic relationships with the rest of the world. The balance of payments on current account shows the income and expenditure for purchase of current goods and services. It records the current position of the country in the transfer of goods, services, and merchandise as well as invisible items, donations, unilateral transfers, etc. It shows the country’s financial position in the international scenario, the extent of accumulated foreign exchange reserves, foreign assets and liabilities and the impact of current transactions are included in the capital account in order to find out the exact foreign exchange reserve. The capital account provides relief to deteriorating balance of payments positions
The challenge before the emerging market economies is to leverage foreign savings to promote domestic growth without having the long-term consequences of external payment imbalances. However, current account deficits, per se, need not necessarily enhance the productive capacity and thus overall GDP growth. This would depend on underlying component factors leading to the current account deficit. The distinction between gross capital inflow and net inflow is useful. As the latter must equal the CAD, there is no way in which net use of foreign savings can increase without an increase in the CAD.
The current account, after being in surplus during 2001-02 to 2003-04, reverted to a deficit in 2004-05. This was despite a robust growth in net invisible account fuelled by software exports and private transfers. The current account deficit (CAD) is attributed to the widening trade deficit, driven primarily by the rise in international prices of petroleum products and gold. They reached a high of 5.1 per cent of GDP in 2006-07 after a somewhat modest growth rate of 3.1 per cent in 2005-06. The net result of these two trends has been a gradual rise in reserve increase to reach 4 per cent of GDP in 2006-07. The most welcome feature was the rise in gross foreign direct investment inflows of US $ 23.0 billion in 2006-07. With FDI outflows also increasing steadily over the last five years, overall net flows moderated. Portfolio investment in the first half of 2006-07 was lower in comparison because of the initial slump in equity markets
Share of engineering goods and petro products has increased by 7.6 percentage points and 10.7 percentage points, respectively. The share of primary products has declined somewhat with the decline in share of exports from agricultural and allied sector being partly offset by a rise in the share of ores and minerals by 2.8 percentage points. The share of chemicals, including petrochemicals, has increased marginally. The share of petroleum crude and products has risen further to 18 per cent in the first half of 2007-08 from 15 per cent in 2006-07. Engineering goods’ share also maintained a rising trend in 2007-08 . The perceptible increase in the share of petroleum products in total exports reflected not only the rise in POL prices but also India’s enhanced refining capacity.
The share of capital goods imports shows the sharpest rise of about 4.9 percentage points in 2006-07 over 2000-01 due to a 3-7 percentage point rise in the share of transport equipment and 1.6 percentage point rise in the share on non-electrical machinery (excluding machine tools). It, however, increased to 13 per cent in the first half of 2007-08. Imports of gold and silver have been at around 8 per cent, though it has increased to 10 per cent in the first half of 2007-08. Share of electronic goods imports has increased to 9 per cent, while food and allied imports show a marginal fall in share due to the fall in the share of edible oils, though import of cereals has shot up in 2006-07 from a negligible level.
With rising POL prices, and India’s rising exports of refined POL products, the United Arab Emirates (UAE) and Saudi Arabia have emerged as the third and fourth largest trading partners of India. With rising POL prices, and India’s rising exports of refined POL products, the United Arab Emirates (UAE) and Saudi Arabia have emerged as the third and fourth largest trading partners of India. There is a perceptible change in the share of India’s trade with Iran and Nigeria (due to rise in import of mineral fuel and oil, etc.) and Australia (due to rise in import of precious stones, metals, mineral fuel and oil, and ores), while the share of Singapore after increasing in some years has moderated. The largest trade deficits are with Saudi Arabia, China and Switzerland. The trade deficit with China has increased further in April-September 2007.
In terms of export destination, the United States continued to be the principal destination accounting for 14.9 per cent of India’s total exports in 2006-07. India’s merchandise exports to South Asian countries increased by 16.6 per cent in 2006-07 compared to the 20.5 per cent growth in 2005-06. Growth in exports to Iran, Saudi Arabia, Belgium and Japan was good. In recent years, India witnessed a major change in its direction of trade in general and with China in particular. India’s export to China, in US dollar terms, was growing at the rate of 20.4 per cent and 22.7 per cent for the years 2005-06 and 2006-07, respectively
In 2006-07, Asia and ASEAN continued to be the major source of India’s imports accounting for 57.5 per cent of total imports. Country-wise, imports from China recorded high growth of 60.1 per cent over and above the 53.1 per cent growth in the previous year. share of iron and steel increased from 0.8 per cent to 8.5 per cent for the same period, while the share of electronic goods, organic chemicals and inorganic chemicals are declining.
Energy shortages, inadequate and unreliable transport and communication facilities are the major problems which hinder the growth of India’s exports. The interest, the exporters are paying on export finance in India is comparatively higher than other countries. “Made in India” is considered a sign of poor quality in overseas markets. Indian exporters do not care much about the quality of their goods. Indian exporters are often regarded as unreliable in respect of their commitment for timely shipment, quality, after-sale service, In India the exporters are unable to obtain latest trade information because of lack of proper facilities of communication. No doubt, of late some progress in the field of Electronic Data Interchange has been made, but it does not cover each and every field relating to export.
