The document discusses how understanding the business environment is important for identifying opportunities, threats, and useful resources. It provides examples of how monitoring the environment can help businesses improve performance by adapting to changes and making innovations to products that meet customer demands. Understanding the environment also allows businesses to be first movers in tapping new opportunities and responding to threats from competitors.

1. GENERATING BUSINESS
IDEAS AND DEVELOPING A
PRODUCT

2. THE IMPORTANCE OF BUSINESS
ENVIRONMENT

3. It helps in Identifying Opportunities and Making First
Mover Advantage
1.
- The environment provides numerous opportunities, and it is necessary to
identify the opportunities to improve the performance of a business.
- Early identification gives an opportunity to an enterprise be the first to
identify opportunity instead of losing them to competitors.
Example: CMP phones are 5x speed on using and it has 100-megapixel
camera. 30 seconds full charge.

4. 2. IT HELPS THE FIRM IDENTIFY THREATS AND
EARLY WARNING SIGNALS
- ENVIRONMENTAL AWARENESS CAN HELP MANAGERS
IDENTIFY VARIOUS THREATS ON TIME AND SERVE AS AN
EARLY WARNING SIGNAL.
EXAMPLE: PATANJALI PRODUCTS HAVE BECOME A
WARNING SIGNAL WHEN IT USED TO THE PRODUCTS.

5. 3. IT HELPS IN TAPPING USEFUL RESOURCES
- ENVIRONMENT IS THE SOURCE OF ALL RESOURCES A BUSINESS NEEDS FOR ITS
OPERATION. IT TAKES NATURAL RESOURCES, HUMAN RESOURCE AND
FINANCIAL RESOURCE AND CONVERT THEM TO GOODS AND SERVICES TO
CUSTOMERS, MAKE PAYMENT OF TAXES TO GOVERNMENT, RETURN ON
FINANCIAL INVESTMENT TO INVESTORS AND SO ON.

6. 3. IT HELPS IN TAPPING USEFUL RESOURCES
EXAMPLE: WITH THE DEMAND FOR THE LATEST TECHNOLOGY,
MANUFACTURERS WILL TAP THE RESOURCES FROM THE ENVIRONMENT TO
MANUFACTURE GOODS SPECS SUCH AS RAM, LOT OF FEATURES AND BOOST
OPERATING SYSTEM RATHER THAN COLLECTING RESOURCES FOR FEW SPECS,
FEATURES AND NOT FAST OPERATING SYSTEM.

7. 4.COPING WITH RAPID CHANGES
- The business environment is changing very
rapidly, and the industry is getting affected by changing
market conditions.

8. - Turbulent market environment, less brand loyalty, divisions of
markets, changes in fashions, more demanding customers, and global
competition are some examples of changing the business environment.
Example: CMP mobile phones started to fastened their operating
system, and go to the high specs such as RAM as they could see the
interest of the consumers.

9. 5. It Helps in Improving Performance
- Environmental studies reveal that the success of any
enterprise is closely bound with the changes in the
environment.
-The enterprises which monitor and adopt suitable
business practices not only improve their performance
but become leaders in the industry also.

10. Example: CMP has been successful in maintaining its
market share due to its proper understanding of the
environment and making suitable innovations in its
products.