Environmental variables are an important category of key success variables for organizations. Key success variables are the critical factors that ensure an organization's competitive success. Environmental variables refer to the political, technological, economic, demographic, social, cultural, customer, competitor, and supplier forces outside an organization that can impact its operations. By properly managing these environmental factors, an organization can adapt to threats and influence its environment, which contributes to its overall success.

1. ENVIRONMENTAL VARIABLES
AS CATEGORY OF KEY
SUCCESS VARIABLES
BY MARKO LUCAS HUPA B.A LGM, MPA
POWER POINT PRESENTATION

2. QUESTION
 Since the organization operates in
a complex socio-economic and
political environment it becomes
necessary to identify
environmental variables as
category of key success variables.
Discuss

3. PRESENTATION COVERAGE
 Key success variables
 Environmental variables
 Environmental variables as a part/category of
key success variables

4. What are key success
variables?
 Bruno and Leidecker (1984) have defined key
success variables as “those characteristics,
conditions or variables that, when properly
sustained, maintained, or managed, can have a
significant impact on the success of a firm
competing in particular industry
 Limited number of areas in which results, if they
are satisfactory, will ensure successful competitive
performance for the organization (Rockart, 1979)
 Are critical factors/activities required for ensuring
the success of the organization.

5. CONT…..
 The notion of Key success variables was first
introduced by Daniel in (1961) and popularized
by Rockart in (1979) with the idea there are
few factors which are decisive for the success
of organization and these factors can be
ascertained so as to achieve overall success
of organization.
 Key success factors involves few areas where
things must go right for the organization to
flourish and for managers goals to be attained
(Bullen & Rockart, Pg.7)

6. Sources of key success
variables
 Rockart 1979, distinguishes between five
sources of critical success factors;
 The industry
 Competitive strategy
 Environmental factors
 Temporal factors
 Managerial position

7. Environmental variables
 It involves set of forces surrounding an
organization that have potential to affect the
way it operates
 However the organization can adapt to their
threats and influence by using controllable mix
element from the environment.
 Environmental variables can be general
environment or task environment

8. Categories of Environmental
variables
 General Environmental variables consists;-
 Political environment
 Technological environment
 Demographic environment
 Economic environment
 Social cultural environment

9. Cont…
 Task environment
 Customers
 Competitors
 Suppliers

10. Organization environment
structure

11. Political environment
 It refers to the government laws, regulations
and policies and activities which are designed
to influence organizations indirectly and set
boundaries on what they can or cannot do.

12. Technological environment
 New development are made in every
organizations in terms of innovative approach
in forming new products, it also requires a
company to stay ahead and update their
technology as it becomes outdated.

13. Economic Environment
 Economic environment includes the impact of
economic factors like interest rates, inflation,
monetary & fiscal policy, taxes and wage rates.

14. Demographic factors
 Demography it concern with the population of
the people such as their age, sex, marital
status occupation, and family.
 Understanding the nature of population in the
business it can help you to forecast future
trend and consumption of your product

15. Social -cultural environment
 These are some important factors that
organizations must analyze. It includes society
lifestyle, beliefs and culture
 These factors play an important role because
they determine the kind of goods, services and
standards that society values.
 Identifying society values may help you to
determine what kind of goods to produce.

16. Customers
 Since customers are the ones who acquire an
organization products and services it is
important to ensure there is:
 New innovations on products and services
 New methods of marketing

17. Competitors
 Competitors refers to the numbers of similar
products, brands, marketers in your industry
who produce same products as you do.
 It is important to know all the competitors, their
organization size, marketing strategies and
technology
 For example a company may purchase its
competitors products for the purpose of
analyzing its quality and construction
techniques.

18. Suppliers
 Suppliers are organizations that provides
resources for other organizations.
 An organization so as to ensure its continuity
should avoid depending on a single supplier.
 Building long term trusting relationship
between the organization and its supplier.

19. Conclusion
 If there is positive response towards
environmental variables they become part and
parcel of key success variables since when
you take them into account they will help you
to monitor and control the situation, respond
with the threats and forecast the future.
 However the adaptability of the threats will
depend on the capacity of organization.

20. END
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