Advertisements
Advertisements
Question
Why is the understanding of business-environment important for managers? Explain with the help of any four points
Advertisements
Solution
No organisation can function in isolation. Understanding of the business environment is of vital importance for the smooth and successful functioning of an organisation. A business environment refers to the aggregate of external conditions, events and resources which are outside the control of a business but interact with it and affect its performance. In other words, everything which is outside the purview of an organisation but affects its performance composes the business environment. Some factors have direct influence and some have the indirect influence on the business. A continuous evaluation and understanding of the business environment help a firm to take account of these forces in a better manner, and thereby improve its functioning. Points highlighting the importance of the understanding of the environment for business enterprises:
- Identification of opportunities and threats: The business environment is ever evolving. An interaction with the environment and careful analysis will help a business identify positive opportunities. It enables the organisation to grab these opportunities, gain maximum benefit and move ahead of its competitors.
- Identification of threats: An identification of the threats can enable the organisation to take appropriate measures such as improving the quality and features of its mobile advertising.
- Accumulating useful resources: The environment offers itself as a source of inputs such as raw material, machinery and labour for the running of an organisation. In return, the business supplies the environment with its output. This is possible only if the enterprises have an understanding of what the environment desires and what it can offer. Thus, it is rational for organisations to take up those resources from the environment which can be converted to the desired output.
- Adjusting to changes: The business environment is dynamic in nature and is prone to numerous socioeconomic changes. A careful analysis and understanding of the environment helps an enterprise in adapting to these changes and taking timely actions
APPEARS IN
RELATED QUESTIONS
What is included in ‘Technological Environment’ of business? State.
What is meant by business environment?
Give one word/phrase/term.
Uncontrollable factors of the business environment.
Correct the underlined word and rewrite the following sentence.
External factors of business environment are controllable.
Correct the underlined word and rewrite the following sentence.
Internal factors of business are beyond control.
Explain the following term/concept.
Business environment.
Explain the following term/concept.
Social environment.
Explain the following term/concept.
Economic environment.
Study the following case/situation and express your opinion.
Just after the declaration of the Lok Sabha 2014 result, the Bombay Stock Exchange Sensex rose by 1000 points in a day.
- Identify the environmental factor which led to this rise giving a reason.
- Explain any two other dimensions of the environment.
Study the following case/situation and express your opinion.
Make in India is an initiative launched by the government of India. It focuses on job creation and skill development and it is in twenty-five sectors of the economy. Under the initiative, brochures on these sectors and web portal were released. The initiative aims at high quality standards and minimizing the impact on the environment. It also seeks to attract foreign capital investment in India.
- Identify dimensions of the business environment.
- Comment on it.
Answer the following.
What is the business environment? Explain the importance of the business environment.
According to the United Nations Environmental Agency, the world produces around 300 million tons of plastic each year, half of which constitutes single-use items. Ford is recycling over one billion plastic bottles every year to develop elements of the car’s interior, reducing the amount of plastic ending up in a landfill. The American car maker has revealed that their Romanian-built EcoSport SUVs’ carpets are made using 470 recycled single use plastic bottles The process for making Ford EcoSport carpets involves shredding bottles and their caps into tiny flakes and then heating them to 260°C. Identify the related dimension of business environment.
"The components of business environment keep on changing due to changes in various circumstances." This shows that business environment is ______.
Which of the following is the feature of Business Environment?
Assertion (A): Changes in fashions and tastes of consumers may shift demand in the market from existing products to new ones.
Reason (R): Business environment is dynamic, i.e., it keeps on changing in consumer preferences.
|
'Cartoony Planet' is a well-known indoor playground for organising parties for children in Noida. It has many play-stations and it organises various activities for the kids to enjoy. Looking at the increasing number of children visiting 'Cartoony Planet', a new indoor playground in the name of 'Tiny-Tots House' came up with advanced swings, play stations and entertainment activities near 'Cartoony Planet'. To compete with the newly opened indoor playground, 'Cartoony Planet' also added some advanced swings and entertainment activities to attract more children. |
The above information highlights one of the features of 'Business Environment'. Identify the feature from the following:
Which among the following best defines 'Business Environment'?
