Elements of Small Business Environment

What is government? Government is the governing body of nation, state, or community. Government determines the way any group of people are ran. There a several different types of government used all around the world. In the United States for example, uses a type of government that has three different branches of power. The Legislative Branch is the law making branch. The Judicial branch is the courts and the low enforcement. Lastly, the Executive branch is the presidential branch. “Each has its own responsibilities and at the same time they work together to make the country run smoothly and to assure that the rights of citizens are not ignored or disallowed.” (Osborne) Usually, governments break up the responsibilities into two or more groups. Two very influential writers wrote about their views on government; Lao-tzu and Machiavelli. These writers were in very different times which makes it very interesting to compare their views. Lao-tzu and Machiavelli had very different views on the ultimate purpose of government, the obligations of government leaders, and the main work of the state.

Competitive environments are defined by the identity, track record, financial strength and market share of key competitors. Harvard Professor Michael Porter 's Five Forces model can be used to evaluate a company 's competitive position. These five forces are barriers to entry (the ability of new players to enter the market), buyer power (the ability of customers to influence price),

In PESTEL framework, the external environment is classified into six broad categories: Political, Economic, Social,

Basic Demographics (age, gender, socio demographic status, etc): This section should include much detail about every client/participant in the interaction,

In legal terms, a government is a set of laws and regulations exerted on a group of individuals. Such an abstract concept, however, would be ineffective without citizens that enforce the established mandates of the government. Thus, the

Pestel analysis consists of environmental factors that lead to the understanding weaknesses and strengths of the organization in an attempt to influence the organization’s success. The macro-environmental factors are political, economic, social, technological, environment and legal.

Demographics can consist of population size, density, location, age, sex, race and occupation. In this analysis, we will focus on examining population

Demographics play a large role in aiding businesses with the adequate information to convince the viewers. The main demographics include gender, age, culture, race, and

External analysis of general environment will be done using PESTEL which refers to how the political, economic, social, technological, environmental and legal environment affects an organization. Below will be a diagram of PESTEL, followed by a brief explanation of each factor and their examples.

Porter’s five forces are used to determine the competitive intensity and attractiveness of a market. These are close forces that affect a company’s ability to make a profit and serve customers. If any of these forces change, a company must reassess its marketplace. The five forces include: the threat of substitute products, the threat of the entry of new competitors, the intensity of competitive rivalry, the bargaining power of customers and the bargaining power of suppliers.

PESTEL analysis is a method used to study macroeconomics - the macroeconomic environment of an enterprise. Otherwise, it is called the general segmentation of the environment. It defines the basic spheres of the environment, which are areas that have a crucial impact on the functioning of the organization. Also marks the future strategy of the organization through an in-depth analysis.

To assure the success of a business over a long period of time the business must be able to conduct regular analysis of their success. They must be able to determine where they are today and have a goal of where they would like to see themselves 5-10 years down the road. In order to conduct a true analysis of the company, one must complete an environmental scan of their organization. Thus scanning for events, trends, issues and expectations that they may be faced with in the future. Furthermore, examining all internal and external environment challenges. Internal environmental challenges may be with employees, shareholders or board of directors or the overall culture of the organization. External environmental

This article summarizes the key ideas and gives an overview of how this concepts works. Describes, how this five competitive forces shape every organization and every market. Summarizes how these forces will define the power of profitability, competitiveness, and attractiveness of the industry. Depending on the facts which is derived from the five forces analysis, the management of organizations will decide how to effect or abuse specific features of their industries.

With the development of the global economy, the interaction between environment and companies became more important, therefore, throughout macro environment analysis, which includes political, economic, social, environment, legal and technology (PESTEL) that provides an indispensable part in the comprehensive list to understand opportunities and threats on the businesses (Searle and Barbuto, 2010). In this industry, political, economy and technology would mainly influence the strategies, thus

The 5 forces are the environmental forces that impact on the companies ability to compete in the given market. The purpose of 5 forces analysis is to diagnose the principal competitive pressures in a market and assess how strong and important each one is.