The document discusses the different types of business environments that can impact an organization. It defines the business environment as consisting of all internal and external factors that influence a business's operations. The internal environment includes factors like organizational culture that a business can control. The external environment contains uncontrollable factors like the economic conditions, competitors, and government policies in the macro environment. It also examines the micro environment surrounding the business, including customers, suppliers, and other stakeholders that directly affect operations.

1. BUSINESS ENVIRONMENTS
BY
PETUNIA F. MAKHUNGA

2. WHAT IS BUSINESS ENVIRONMENT?
• BUSINESS ENVIRONMENT CONSISTS OF ALL THE
FACTORS THAT HAVE A BEARING ON THE BUSINESS SUCH
AS THE STRENGTHS, WEAKNESSES, INTERNAL POWER
RELATIONSHIPS AND ORIENTATIONS OF THE
ORGANIZATION, GOVERNMENT POLICIES.

3. FEATURES OF BUSINESS ENVIRONMENT
 BUSINESS ENVIRONMENT IS THE SUM TOTAL OF ALL
FACTORS INTERNAL & EXTERNAL TO THE BUSINESS FIRM
THAT GREATLY INFLUENCE THEIR FUNCTIONING
 IT COVERS FACTORS AND FORCES LIKE CUSTOMERS,
COMPETITORS, SUPPLIERS, GOVERNMENT, AND THE
SOCIAL, CULTURAL, POLITICAL, TECHNOLOGICAL AND LEGAL
CONDITIONS.

4. 
THE
CHANGES
UNPREDICTABLE.

BUSINESS ENVIRONMENT DIFFERS FROM PLACE TO PLACE,
REGION TO REGION AND COUNTRY TO COUNTRY. EX:
POLITICAL CONDITIONS IN INDIA DIFFER FROM THOSE IN
PAKISTAN. TASTE AND VALUES CHERISHED BY PEOPLE IN
INDIA AND CHINA VARY CONSIDERABLY.
IN
BUSINESS
ENVIRONMENT
ARE

5. Types of environment
Internal environment
External environment
Micro Environment
Market environment
Macro environment
ENVIRONMENT OF BUSINESS

6. TYPES OF ENVIRONMENT
• ON THE BASIS OF THE EXTENT OF INTIMACY WITH THE
FIRM, THE ENVIRONMENTAL FACTORS MAY BE
CLASSIFIED IN TO DIFFERENT TYPES OF LEVELS:
• INTERNAL FACTORS: CONTROLLABLE AND DIRECT
IMPACT ON BUSINESS
• EXTERNAL FACTORS: UNCTROLLABLE AND INDIRECT
IMPACT ON BUSINESS

7. INTERNAL ENVIRONMENT
• THE INTERNAL FACTORS ARE GENERALLY REGARDED AS
CONTROLLABLE FACTORS BECAUSE THE COMPANY HAS
CONTROL OVER THESE BECAUSE THE COMPANY HAS
CENTRAL OVER THESE FACTORS; IT CAN ALTER OR MODIFY
SUCH FACTORS AS ITS PERSONNEL, PHYSICAL FACILITIES,
ORGANIZATION AND FUNCTIONAL MEANS, SUCH AS
MARKETING MIX TO SUIT THE ENVIRONMENT.

8. MICRO ENVIRONMENT
MISSION
 VISION
OBJECTIVES
BUSINESS FUNCTIONS
MANAGEMENT STRUCTURE
ORGANIZATIONAL CULTURE

9.  A VISION IS A BROAD EXPLANATION OF WHY THE FIRM EXISTS
AND WHERE IT IS TRYING TO LEAD ITGIVES THE ORGANISATION
A SENSE OF PURPOSE AND A SET OF VALUES THAT UNITE
EMPLOYEES IN A COMMON DESTINY.
 A MISSION STATEMENT OUTLINES THE FUNDAMENTAL
PURPOSE OF THE ORGANISATION.
 OBJECTIVES THEREFORE, REPRESENT THE OPERATIONAL
SIDE OF AN ORGANISATION

10. BUSINESS FUNCTIONS REFER TO A SET OF OPERATIONS THAT
ARE EXECUTED REGULARLY TO CARRY OUT A PART OF THE
MISSION FOR AN ORGANISATION. THIS TERM CAN ALSO BE
DEFINED AS THE ESSENTIAL FUNCTIONS SUCH AS SALES AND
PRODUCTION THAT AN ORGANISATION CANNOT DO WITHOUT.
ORGANIZATIONAL STRUCTURE, COMPOSITION OF BOARD OF
DIRECTORS, EXTENT OF PROFESSIONALIZATION OF
MANAGEMENT SOMETIME DELAY DECISION MAKING WHILE SOME
OTHERS FACILITATE QUICK DECISION MAKING

11. • ORGANIZATIONAL CULTURE IS THE BEHAVIOUR OF HUMANS WHO
ARE PART OF AN ORGANIZATION AND THE MEANINGS THAT THE
PEOPLE ATTACH TO THEIR ACTIONS. CULTURE INCLUDES THE
ORGANIZATION VALUES, VISIONS, NORMS, WORKING LANGUAGE,
SYSTEMS, SYMBOLS, BELIEFS AND HABITS. IT IS ALSO THE
PATTERN OF SUCH COLLECTIVE BEHAVIOURS AND ASSUMPTIONS
THAT ARE TAUGHT TO NEW ORGANIZATIONAL MEMBERS AS A WAY
OF PERCEIVING, AND EVEN THINKING AND FEELING.
ORGANIZATIONAL CULTURE AFFECTS THE WAY PEOPLE AND
GROUPS INTERACT WITH EACH OTHER, WITH CLIENTS, AND WITH
STAKEHOLDERS.

12. EXTERNAL ENVIRONMENT
• MARKET ENVIRONMENT: IS ALSO KNOWN AS TASK ENVIRONMENT
AND OPERATING ENVIRONMENT BECAUSE THE MICRO
ENVIRONMENTAL FORCES HAVE A DIRECT BEARING ON THE
OPERATIONS OF THE FIRM
• MACRO ENVIRONMENT: IS ALSO KNOWN AS GENERAL
ENVIRONMENT AND REMOTE ENVIRONMENT. MACRO FACTORS
ARE GENERALLY MORE UNCONTROLLABLE THAN MICRO
ENVIRONMENT FACTORS.
• WHEN THE MACRO FACTORS BECOME UNCONTROLLABLE, THE
SUCCESS OF COMPANY DEPENDS UPON ITS ADAPTABILITY TO
THE ENVIRONMENT.

13. o
MARKET ENVIRONMENT
 SUPPLIERS
 EMPLOYEES
 CUSTOMERS
 COMPETITORS
 INTERMEDIARIES
 STAKEHOLDERS
 COMMUNITY

14.  SUPPLIERS ARE THOSE WHO SUPPLY THE INPUTS LIKE RAW
MATERIALS AND COMPONENTS TO THE COMPANY. THE
IMPORTANCE OF RELIABLE SOURCE/SOURCES OF SUPPLY TO
THE SMOOTH FUNCTIONING OF THE BUSINESS IS OBVIOUS.
 CUSTOMER IS A PERSON WHO PURCHASES AND USES GOODS
AND SERVICES
 COMPETITORS NOT ONLY INCLUDE THE OTHER FIRMS THAT
PRODUCE SAME PRODUCT BUT ALSO THOSE FIRMS WHICH
COMPETE FOR THE INCOME OF THE CONSUMERS THE
COMPETITION HERE AMONG THESE PRODUCTS MAY BE SAID
AS DESIRE COMPETITION AS THE PRIMARY TASK HERE IS TO
FULFILL THE DESIRE OF THE CUSTOMERS.

15.  INTERMEDIARIES INCLUDE MIDDLEMEN SUCH AS AGENTS AND
MERCHANTS THAT HELP THE COMPANY FIND CUSTOMERS OR
CLOSE SALES WITH THEM. THE MARKETING INTERMEDIARIES ARE
VITAL LINKS BETWEEN THE COMPANY AND THE FINAL
CONSUMERS
 STAKEHOLDER IS A PERSON, GROUP OR ORGANIZATION THAT HAS
INTEREST OR CONCERN IN APARTICULAR ORGANIZATION
 COMMUNITY IS ANY GROUP THAT HAS AN ACTUAL OR POTENTIAL
INTEREST IN OR IMPACT ON AN ORGANIZATION’S ABILITY TO
ACHIEVE ITS INTERESTS. EX-MEDIA, CITIZENS, LOCAL PUBLIC ETC.
 EMPLOYEES ARE THOSE PEOPLE THAT WORK FOR THE
ORGANIZATION.

16. MACRO ENVIRONMENT
ECONOMIC ENVIRONMENT
POLITICAL ENVIRONMENT
TECHNOLOGICAL ENVIRONMENT
SOCIAL ENVIRONMENT
GLOBAL ENVIRONMENT

17. ECONOMIC ENVIRONMENT REFERS TO THE AGGREGATE OF
THE NATURE OF ECONOMIC SYSTEM OF THE COUNTRY,
BUSINESS CYCLES, THE SOCIO-ECONOMIC INFRASTRUCTURE
IT INCLUDES FACTORS SUCH AS CHARACTERISTICS AND
POLICIES OF THE POLITICAL PARTIES, NATURE OF
CONSTITUTION AND GOVERNMENT SYSTEM RELATING TO
BUSINESS POLICIES AND REGULATIONS
TECHNOLOGICAL ENVIRONMENT INFLUENCES THE BUSINESS
IN TERMS OF INVESTMENT IN TECHNOLOGY,CONSISTENT
APPLICATION OF TECHNOLOGY AND THE EFFECTS OF
TECHNOLOGY ON MARKETS.

18. THE SOCIAL DIMENSION OR ENVIRONMENT OF A NATION
DETERMINES THE VALUE SYSTEM OF THE SOCIETY WHICH, IN
TURN AFFECTS THE FUNCTIONING OF THE BUSINESS.
THE GLOBAL ENVIRONMENT REFERS TO THOSE FACTORS
WHICH ARE RELEVANT TO BUSINESS SUCH AS WTO PRINCIPLES
AND AGREEMENTS, INTERNATIONAL CONVENTIONS, TREATIES,
AGREEMENTS, DECLARATIONS, PROTOCOLS, ECONOMIC

20. • REFERENCES
• THAKUR. A, SINGH. D, EKTA, BANSAL. K, MUSTAFA. (2012). BUSINESS
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• MATCH. P. (2013). BUSINESS ENVIRONMENTS.
HTTP://WWW.SLIDESHARE.NET/DANIYALT/BUSINESS-ENVIRONMENT-26301669.
ACCESSED ON 04/03/2014
• SINGH. A. (2009) BUSINESS ENVIRONMENTS.
HTTP://WWW.SLIDESHARE.NET/SINGHANSHU21/FIRST-CHAPTER. ACCESSED ON
04/03/2014
• AHMAD. M.(2012). BUSINESS ENVIRONMENTS.
HTTP://WWW.SLIDESHARE.NET/MUNIF/BUSINESS-ENVIRONMENTS. ACCESSED ON
04/03/2014
• SELVA. A. (2013) BUSINESS ENVIRONMENTS.
HTTP://WWW.SLIDESHARE.NET/ARUNSELVA11/BUSINESS-ENVIRONMENT-25086837.
ACCESSED ON 04/03/2014