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business enviroment class 12 cbse_(1).pptx
- 1. Pre se nte d by : Van s h Mi t h wan i Aa rav Ga u r Di vy a ns h Pa n dey BUSINESS ENVIRONMENT 1
- 2. INTRODUCTION TO BUSINESS ENVIRONMENT Defination Thebusiness environment refers to all external forces, institutions, and factors which affect the functioning of a business enterprise. Explanation These forces include economic, social, political, legal, and technological aspects that are beyond the control of an individual business but affect its performance. 02
- 3. FEATURES 01 02 03 04 Totality of ExternalForces: It is the sum total of all external forces that influence business decisions. Specific and General Forces: Specific forces include customers, competitors; general forces include political, legal, technological conditions. Interrelatedness: Different factors of the environment are closely interlinked. Dynamic Nature: The business environment keeps changing frequently 03 05 Uncertainty: It is difficult to predict future environmental changes. 06 Relativity: Business environment varies from country to country and even region to region.
- 4. 1 IMPORTANCE OF BUSINESS ENVIRONMENT IDENTIFYING OPPORTUNITIESAND GETTING FIRST-MOVER ADVANTAGE Helps firms grab emerging trends early. IDENTIFYING THREATS AND EARLY WARNING SIGNALS Firms can prepare to face environmental risks. TAPPING USEFUL RESOURCES 04 Environment helps in locating suppliers and customers. COPING WITH RAPID CHANGES Allows businesses to adapt quickly. ASSISTING IN PLANNING AND POLICY FORMULATION Environment analysis helps a business understand external factors and make better strategies to adapt, grow, and stay competitive. IMPROVING PERFORMANCE Firms aligned with environment tend to perform better. 2 3 4 5 6
- 5. DIMENSIONS 05 ECONOMIC ENVIRONMENT SOCIAL ENVIRONMENT TECHNOLOGICALENVIRONMENT POLITICAL ENVIRONMENT LEGAL ENVIRONMENT
- 6. ECONOMIC ENVIRONMENT Includes factors likeinflation, interest rates, income levels, etc. that affect business performance. SOCIAL ENVIRONMENT Includes social values, customs, traditions, lifestyle, and education levels that influence business demand. TECHNOLOGICAL ENVIRONMENT Involves changes in technology, innovation, automation, and R&D that affect how businesses operate. POLITICAL ENVIRONMENT Includes government policies, political stability, and the legal framework influencing business decisions. LEGAL ENVIRONMENT Refers to laws and regulations like consumer protection, labor laws, and trade regulations that businesses must follow.
- 7. RECENT DEVELOPMENTS ININDIAN BUSINESS ENVIRONMENT 06 • Liberalisation (1991) – Reduced government restrictions on businesses. • Privatisation – Transfer of ownership from public to private sector. • Globalisation – Integration with global economy. • Digital Revolution – Growth of online business platforms and fintech. • Startup India & Make in India – Boost to entrepreneurship and manufacturing.
- 8. Demonetisation A Major EnvironmentalChange What is Demonetisation? On November 8, 2016, the Government of India announced that ₹500 and ₹1000 currency notes would no longer be legal tender. This move was aimed at curbing black money, counterfeit currency, and promoting a cashless economy.
- 9. SHIFT TOWARDS DIGITALPAYMENTS SHORT-TERM CASH CRUNCH INCREASED TAX COMPLIANCE CONSUMER SPENDING DECLINED TEMPORARILY CHANGE IN BANKING BEHAVIOR IMPACT ON BUSINESS ENVIRONMENT Affected small businesses, traders, and daily wage workers due to lack of liquid cash. Boosted use of UPI, digital wallets, and online transactions. Encouraged formalisation of businesses and better tax reporting. Retail and real estate sectors saw a drop in sales. People moved money into bank accounts; increased bank deposits temporarily.
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