Question

Alfa Graphics Ltd. was a reputed Indian company which had been in business for many years. The Chief Executive Officer of the company, Rohit Gupta, always believed in understanding the business environment as well as responding and adapting to it. When he found that a foreign multinational company, Leno Graphics, is entering the Indian market with new substitutes, he prepared to meet this threat by reducing cost and creating good quality and aesthetically appealing layouts, advertisements, logos, etc. As a result, Alfa Graphics Ltd. was not only able to retain its own customers but also started getting new projects.

The point of importance of Business Environment discussed above is:

Options

• Tapping useful resources.

• Identifying threats and early warning signals.

• Improving performance.

• Identifying opportunities and getting first-mover advantage.

Answer 1

Identifying threats and early warning signals.

Explanation:

Alfa Graphics Ltd. saw a threat when a foreign company entered the Indian market with new products that could replace theirs. Alfa Graphics cut costs and raised quality to compete with these other companies. This shows that the business was aware of market threats and prepared for them.