The Micro Environment

It is of great importance to make an analysis of the environment in which an organisation operates in order to develop and implement a suitable, successful strategy for the company. According to Johnson, Scholes and Whittington (2008) the business environment of a company is an important issue determining its survival and success. There are several layers of this business environment – the macro environment, the industry or sector layer, the layer with competitors and markets.

1. Macro environment analysis: the major externals which affect company’s decision making, marketing strategy and performance. It includes:

An organization’s macroenvironment consists of nonspecific aspects in the organization’s surrounding that have the potential to affect the organization’s strategies. Macroenvironmental variables include

The macro environment is defined as the major external of uncontrollable factors which dramatically influence to the business strategies and impact its performance by Gupta (2013). The external environment scanning states to assist the organization realize the issue and understand the dynamic market. The interesting external environment analysis model is Porter’s Five Forces Model which consist of new entrants, buyer power, supplier power, treat of substitutes and rivalry (Julius, 2014). According to Holden, in term of rivalry, the extremely higher fuel consumption of Holden alert to the organization to lose its market share which causes to reduce the number of customers and its competitive advantage. At that time, the poor car’s performance

Microculture: “distinctive culture shared by a small group that is often based on location or within an organization” (Microculture. n.d). The eighteen microcultures discussed within the dissertation are as followed: Rich people, poor people, African American people, white people native American people, Asians, Muslims, people who participate in the new age movement, homosexual, women, homosexual men, people with disabilities, students who re labeled gifted or talented, illegal immigrants, legal immigrants, people residing within the United States, but don’t speak English, Jews, Catholics, and stay at home mothers. Each microculture will be appraised through my cultural lens of feelings and opinions, what sources of socialization contributed

This factor in the Porter Five Forces Model refers to the power that those companies supplying products to Target have. In the retail industry, suppliers are often very powerful, as they often provide products to direct competitors of each other. An example of a supplier with a high degree of power is Procter and Gamble (P&G), who sells to many retailers including Target, WalMart, Costco, Safeway and many others. As P&G is a leader in personal care products that are more often sold on price and availability than intensive shopping comparisons (like how plasma TVs are purchased for example) this supplier has major influence over Target and their profitability. This is the reason why this specific aspect of the five forces model is first. Target Corporation

At first glance, one would not expect the Technology Center to provide a place of study for some of the most creative students at USI: the art and theatre majors. The cold, hard concrete building does not seem to assist in providing any type of creative inspiration for aspiring artists. The name alone seems to imply that the building is used to train computer engineers; this is far from the truth. As an art major, the basement of this building has unwillingly become known as a second home to me. The systematic bustle of art students booking it to their next class with portfolios and art boxes in hand is a familiar sight to me. However, as I looked down the hall from my bench, I saw a completely different type of artist; I saw theatre artists.

Micro environment covers the internal factors which influence the operations of organization. McDonald’s is influenced by its internal factors .The internal factors are-

environmental analysis of the above mentioned external issues. Additionally, the outline of the analysis may vary with the organization’s size and market complexity.

Identifying influencing factors of a company’s macro-environment helps in the strategic development and management within a company. The macro-environment outlines an industry and the competitive environment as seen in figure 3.1, (Gamble, Peteraf, Thompson, 39). Within the macro-environment there are the political factors, economic conditions, sociocultural forces, technological factors, environment forces, and legal/regulatory factors. All of these factors blanket the habitat an industry and its competition thrive in. Inside the industry and competitive environment there are five factors that influence an individual company. The five factors are suppliers, rival firms, new entrants, buyers, and substitute products. The biggest impact on a company are these five factors. For example, Under Armour focuses on their industry and competitive environment to survive and grow. Their strategy to win over the market share from Nike and Adidas consists of expanding a stable and original brand within record time, taking an innovative approach to their product line-up and brand-name appeal where the market seemed to be barren, and lastly, the company enters in the foreign market early on to establish its brand and influence markets outside of the US.

The environment is like a double-edged sword, providing companies opportunities but threats as well. Therefore, in an increasingly hostile marketplace, a systematic and careful environmental analysis is supposed to be considered by companies (Johnson et al, 2011). The macro-environment of a company can be analysed by the framework of PESTEL, which includes six categories: political, economic, social, technological, environmental, and legal (Johnson et al, 2011, Appendix A ).

The market environment consists of both the macro environment and the micro environment. On macro environment the firm need to follow it and they can’t to control it. It consist variety of external factors that is economic, social, political, legal and technological. In the macro environment the firm should analyze national political issues, culture and climate, key macroeconomic conditions, health and indicators (such as economic growth, inflation, unemployment, etc.), social trends/attitudes, and the nature of technology's impact on its society and the business processes within the society. The microenvironment refers to the internal environment of the company such as consumer/customer, Supplier, competitors, the media (public) and in

An organization is an open system; therefore it interacts with its environment. To manage the relationship with the environment, a large part of strategic planning is concerned. The environmental factors can be divided to 2 main categories, which is MACRO and MICRO .Macro environmental factors seriously affect an organization business practice, profitability and future progress. It can

Microenvironment- microenvironment surrounds the factors that are close a company that affects their ability to serve their customers, this would include; Customers, suppliers, competitors, other departments within the company, general public, marketing intermediaries and finally members of the distribution channel. These are all forces that closely influence the company and they have a direct affect on the organizations relationship. The suppliers of a company are a part of the microenvironment as even if there is a slight delay in receiving any supplies off the suppliers can result in the customers not being satisfied. Marketing intermediaries are the people that are helping to promote and sell the companies products. Competitors include companies that are offering the same or similar products, for example; Morrisons, Tesco and Asda are all in competition with each. It is in the company’s best interest to develop a strategic advantage over their competitors, encouraging customers to come to them not their competitors. This would include Tesco giving you vouchers for any price difference with their competitors ( if your total bill comes to more than it would in one of the competitor stores then you are given the

The microeconomics environment is the study of individuals and firms or organisations, which are directly linked to business. The study of microeconomics focus on subsisting and prospective stakeholders of company.