INTEGRALUNIVERSITYBusiness Environment Introduction
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Environment of a business means the external forces influencing the business decisions.
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INTEGRALUNIVERSITYBusiness Environment Introduction
- 1. ©INTEGRALUNIVERSITY Business Environment Introduction Mr. Shahab Ud Din Assistant Professor DCBM 9580624322
- 2. INTRODUCTION
- 3. What is Business..?? • A business is a legally recognized organization designed to provide goods and services toconsumers withthe motive of earning profits.
- 4. What is environment..?? • Circumstances, influences, stresses, and competitive, cultural, demographic, economic, natural,political, regulatory, and technological factors (calledenvironmental factors) that effect the survival, operations, and growth of an organization.
- 5. Business Environment • Definitionof Business environmentby Davis Keith“TheAggregateofallconditionsevents andinfluencesthatsurroundandaffect business.”
- 6. Characteristics ofBusiness environment. • Business is the surrounding situation that affect the business. • Business environment is very Complex and needs a deep study. • Dynamic nature is oneof the part of business environment. Study of changes is veryimportant for the business. • Environment = Opportunities & Threats
- 7. Characteristics of Business Environment. • Changes in the environment cant be done by one businessman. Businessmanhasto adjust to the environment. • Creates framework for business. • It’s a challenge and an opportunity for the business man and its study can help make or brake the business. • As the business environment is very complex and cannot be changed hence It needs adaptability.
- 8. Need & Importance of Business Environment. • The study of Business Environmenthelps keepingthe business flexible. • To exploit business opportunities fully.
- 9. Need& Importance of Business Environment. • To make business socially acceptable. • To keep the business enterprise alert. • To maintainadaptabilityto socio-economic changes. • To understand future problems and prospects. • To ensure optimum utilization of resources.
- 11. Types ofBusinessEnvironment. • PoliticalEnvironment. • Economic Environment. • Social Environment. • Technological Environment. • Natural Environment. • InternationalEnvironment. • Demographic Environment.
- 13. currentBusiness environmentof India. Average inflation • 2016 5.92 % • 2015 5.88 % • 2014 6.37 % • 2013 10.92 %
- 14. currentBusiness environmentof India. • Thissector hasattracted about $1647 million from April 2000 to May 2015. 100% FDI is allowedunder automatic route. During year 2013– 14, FDI in textile sector was increased by 91%. Indian textile industry is expected reach up to $141 billion till2021. • SEBI hasincreased the investment limits for FDIs to invest in India. • liberalisationof import and export policies.
- 15. Conclusion. ThebusinessenvironmentofIndia isbetterthantheother countries. TheGDP ofIndiaAccordingtoInternationalMonetaryFund WorldEconomicOutlook(April-2015),GDP (nominal)ofIndia in2014atcurrentpricesis$2,049.5billion. Indiacontributes2.65%oftotalworld'sGDPinexchangerate basis.India shares17.5percentofthetotalworldpopulation and2.4percentoftheworldsurfacearea. TheIndiangovernmenthastakenmanystepstoimprovethe conditionsofthecountryandwhichhavehelpedthebusiness environmenttoimproveandexpand.
- 16. CHARACTERISTICSOF INDIANBUSINESS BUSINESS Bigger Role For Govt. Competition Opportunities Management As a Science Globalisation Technology Waning Trust Transition
- 17. BUSINESS OBJECTIVES BUSINESS GOALS POWER QUALITY PRODUCTS & SERVICES CHALLENGING JOY OF CREATION SERVICE TO SOCIETY MARKET LEDERSHIP EMPLOYEE SATISFACTION & DEVELOPMENT GROWTH PROFIT
- 19. Porter’s 5 Model
- 21. Global Environment Technological Environment Economic Environment Political Environment Social-Cultural Environment Natural Environment Increasing opportunity as world has become one market Technology reaches people through business Growth strategy Role of legislature Culture creates peopleManufacturing depends on physical inputs Improving quality Increased productivity Economic system Role of executive Culture and globalization Mining and drilling depend on natural environment Competition from MNCs Need to spend on R&D Industry Role of judiciary Culture determines goods and services Agriculture depends on Nature Capital and technology transfers Fast changing technology Agriculture Constitution of Determines People’s attitude to business and work Trade between two regions depends on geographical factors. Deciding which markets to enter and how to enter Rise and decline of products and organizations Infrastructure New direction for government’s role Caste system Transport and communication depend on geographical factors. Adjusting the management process High expectations of consumers Money and capital markets Spirit of collectivism and individualization The needs of people and demand for various products largely depend on physical environment and WTO Problem of techno structure Per capita and national income Education, awareness and enlightenment System complexity Population Family and marriage Increased regulation and stiff opposition New Economic policy Authority Demand for capital Scientific spirit Social change Ethics in business Social responsibility
- 22. Variable Relevance to Business Income & employment Purchasing power of people & demand for goods & services. GDP trends Overall investment climate in the country. Distribution of income Prevailing inequalities in income & wealth distribution. Price Trends _____/output discuss inventory ____ profitability, ____ investment etc. Tradeand BOP Trends Degree of flexibility on exports and imports, incentives/controls. Industrial policy. Role & Scope for private investment. Monetary policy. cost and availability of credit, its impact on demand Global linkages. Fosters open competition, removal of trade barriers, protectionism abandoned. Economic planning. Priority areas/sectors of investment. Global economic Trends. Influences outsourcing Foreign investment, etc.
- 23. Pre-1991 situation Post-1991 situation Consequent/implication of the change Private sector excluded from many important industries. In a number of other important industries public sector had priority to establish new undertakings. All but a few industries are open to the private sector. Enormous scope for private investment. Considerable freedom to decide the portfolio strategy. Competition increases substantially and public sector loses its monopoly/dominant positions. Entry, involving investment above specified exemption limit, are restricted by licensing. All but a few industries are free from licensing. Reinforces the above factors. Entry of large firms was subject to MRTP Act restrictions, besides licensing. No MRTP Act restrictions on entry. Reinforces the above factors. Licensing and MRTP Act restrictions on growth of existing undertakings. All but a few industries are free from licensing restrictions on growth. No MRTP Act restrictions on growth. Companies can grow organically and by acquisitions. Firms will grow in size and several industries will witness consolidation of firms. A small number of firms would eventually dominate the industry in several cases. Limited scope for foreign capital and technology. Foreign capital and technology policies have been substantially liberalized. Entry of many foreign firms by projects and acquisitions. for Indian firms for acquiring technology and establishing joint ventures. Substantial increase in competition. Highly restrictive import policy. Imports substantially liberalized. User industries can benefit by global sourcing. Import competing firms face stiff competition. Global competition emerges in the Indian market. Indian firms will have to improve their competitiveness and become more innovative to face the global competition.
- 24. Variable Relevance to Business Maintaining Law and order. Payment of Taxes. Licensing. Providing information for making policy decisions. Money & credit. Taking up & completely contracts/project. Facilitate fair competition. Participation in voluntary programs. Facilitate growth & development of business. Service to Govts. bodies. Providing Infrastructure Implementation of rules, policies, programs envisaged by the govt. Exchange of information. Protecting the interests of small industries. Facilitate transfer & adoption of technology. Govt. to Business Business to Govt.