Business Environment
Business is defined as the exchange of goods and services, whereas the environment is a geographical area or your surroundings. For a business to exist, there must be some surrounding, and for this reason, a business has to work in an environment. A business environment can factors that surround the growth of a business organization. These factors are both Internal and External.
INTERNAL FACTORS
Internal factors are factors within the company that impact the success and approach of operations in an organization. Unlike external factors, internal factors this is controlled; however, managing internal operations’ strength is key to a successful business organization. We will look into how Leadership roles, employee participation, and the organization’s mission statements are essential in determining organizational culture.
The leadership style of any organization is important in impacting the organizational culture. A poor leader can have a negative and detrimental impact on the company’s culture. A leader that disregards the rules sets a bad precedent as the employees start behaving accordingly. Leaders should lead by example as they set standards of behavior, and the employees follow suit. Organizational culture should be communicated, supported, and enforced through every level.
People are a huge internal factor for a strong business. Motivated employees that are qualified and understand the management expectations given the tools, support, and encouragement to meet organization goals and surpass them is a huge plus for a successful business. Constant communication between managers and employees is important because employees feel valued and rewarded and in turn, they go above and beyond for the organization standards
A mission statement defines what an organization is, why it exists, and the reasons for being. The mission statement must be communicated by management to the employees. The reason you produce specific goods and provide certain services is essential on how much they buy-in and, in turn, motivates the employee as they understand the mission and objectives of the organization.
EXTERNAL FACTORS
External factors are things outside a business that has a positive or negative impact in a business environment. A business cannot control these variables; hence the best option is to react and make adjustments to remain profitable. Several major factors affect a business organization but will focus on three, and this is Economical, Political and Technological
No external factor affects business more than an economic condition, whether positive or negative, the effect is felt. The economy is the determining factor in the success of a business. As the economy goes through expansion and contraction, the business environment changes as well. A positive business environment is favorable to the development of a business, on the other hand, a negative environment would scale down the growth of the business
Political factors are government regulations that influence the operation of a business organization. They directly impact the business environment, but they also have a significant and indirect impact that influences business operation, but these factors may also be current or impending legislation. For a business to be successful, managers must keep an eye out for these changes and adjust and make decisions effectively.
Technology has been at the forefront of many businesses for age’s technology infrastructure affects the culture, efficiency, and relationships of a business. In today’s business environment, employees need to interact and communicate with clients clearly and quickly. When customers and organizations use technology in a business environment, operations become more efficient.
Conclusion
Many contributing factors affect a business environment both internally and externally, and these factors play a significant role in running smoothly and the success of a business. Both of these elements should be considered before a decision is made.
Reference
www.okbdc.org/why-is -technology-important-in-business.
www.marketing tutor .net/political-factors-affecting-business-environment
www.mageplaza.com/blog/what are-the-internal-and-external-effect- in-a-business-environment
http//courses.lumenlerning.com/win-organizational-behavior/human relation
http//your business.azcentral.com/internal & external factors that affect an organization Sampson Quain
http//pestleanylisis.com