The document discusses the different components of a business environment. It describes the business environment as consisting of internal and external factors. The internal environment refers to conditions within an organization that can be controlled by management, such as employees and organizational structure. The external environment consists of forces outside the organization's control that affect its performance, including the political-legal, economic, socio-cultural, and technological environment as well as specific industry forces like customers and competitors. Each component of the business environment is complex and dynamic, with the potential to significantly impact business operations.

1. By:
Upama Rai
25th April, 2016

2. • Consist of all components of surroundings of
a business organization which affect or
influence its operations and determine its
effectiveness

3. Multi-
faceted
Complex
Far
Reaching
Impact
Dynamic
CHARACTERISTICS OF BUSINESS
ENVIRONMENT

4. TYPES OF BUSINESS ENVIRONMENT
INTERNAL ENVIRONMENT EXTERNAL ENVIRONMENT
SPECIFIC OR TASK
ENVIRONMENT
GENERAL ENVIRONMENT

5. • Refers to all conditions and forces within
the organization affecting a business
operation
• Can be controlled by the management

6. Components of
Internal Environment
Owners
Employees
Structure
Corporate Result
Unions
Organizational Goals
and policies

7. • Refers to that forces and institutions outside
the organization that potentially can affect the
organization’s performance.

8. EXTERNAL ENVIRONMENT
SPECIFIC OR TASK ENVIRONMENT GENERAL ENVIRONMENT
POLITICAL-LEGAL ENVIRONMENT
ECONOMIC ENVIRONMENT
SOCIO-CULTURAL ENVIRONMENT
TECHNOLOGICAL ENVIRONMENT

9.  Consists of specific organization or groups that
influence an organization’s performance.
 Have a direct and immediate impact on the
managerial decision and actions and are directly
relevant to the achievement of organizational goals.

10. Components:
COMPONENTSof
SPECIFICorTASKENVIRONMENT
Customers
Suppliers
Competitors
Government
Pressure Groups
Financial Institutions
Strategic Allies

11.  Refers to the broad external conditions that may
effect business activities of an organization.
 Uncontrollable and requires proper monitoring of
the components to adapt on the basis of emerging
changes.

12. Political
Environment
Economic
Environment
Socio-
Cultural
Environment
Technological
Environment

13.  Refers to government regulations and the legal
system for business.
Constitution
Political philosophy
Political Parties
Political institutions
Legal institutions
Components :

14.  Refers to all factors, which give shape and form to the
development of economic activities.
 Consists of interest rates, inflation, stock market
fluctuation, etc.
Economic system
Economic policies
Economic conditions
Capital market
Globalization
Components:

15.  Includes the total social forces within which the
organization operates.
 Involves traditions, social values, beliefs, norms,
attitudes custom and demographic composition.
Demography
Lifestyle
Social Values
Social Institutions
Religion
Language
Components :

16.  Refers to the systematic application of knowledge
essential to do things
 Focuses on machines and equipment, transmission of
information, new techniques and processes, etc.
Components:
Nature of Technology
Pace of technological change
Technology Transfer
Research and development Budget