The Remote Environment And The Environment

As for external factors one of the external factors would be perhaps a new law that is given and affects directly or indirectly the business and that business needs to make some changes.

The external environment of an organization represents factors outside the company that affect the company's ability to function. The business cannot control these aspects but can answer to these changes if it needed. Of course the main problem for business managers is to manage to respond early to these changes in the external environment, but this depends on how soon any change is identified. Most of external environmental factors for example, economic conditions, are reported daily in the media; managers have a wealth of information with the help of which they can develop strategic plans. Nevertheless, some external factors are difficult to identify, especially when they are changing very slowly or hidden from

The external environment of an organization represents factors outside the company that affect the company's ability to function. The business cannot control these aspects but can answer to these changes if it needed. Of course the main problem for business managers is to manage to respond early to these changes in the external environment, but this depends on how soon any change is identified. Most of external environmental factors for example, economic conditions, are reported daily in the media; managers have a wealth of information with the help of which they can develop strategic plans. Nevertheless, some external factors are difficult to identify, especially when they are changing very slowly or hidden from

An organization’s external environment is terribly important and must be studied and understood for the organization to truly succeed. Through such study and understanding, a manager would be able “mitigate threats and leverage opportunities” that are caused by the six segments identified as macro-level external forces: (1) political, (2) economic, (3) sociocultural, (4) technological, (5) ecological, and (6) legal (Rothaermel, 2013, pp. 56-57). Since the manager’s decisions, or firm effects, have a greater impact than those external forces mentioned only when the manager accounts for them and builds a strategy around them, the manager must be aware of and understand these forces to be

When manipulating a business’s strategy, it is important to focus on the external factors in the environment. An external analysis is where a business conducts environmental scanning that present a company with the key external forces influencing the organization. The facets of external forces examined are the business environment, remote environment, or the competitive environment. A business environment is all of the external factors in the general environment that a firm cannot control, but can affect their strategy. The remote environment is the forces that affect most firms. Lastly, a competitive environment is the firm’s specific industry and its entirety. The external analysis is pertinent to a company called Dick’s Drive- In; without it, Dick’s would not be a thriving popular business today.

The external environment affects a firm’s strategic actions. Essentially, if a company decision has created a disaster in the environment, they

Economic factors – which include interest rates, economic growth, exchange rates, inflation and taxation changes (Nieman, G; 1998). The change the economy can have a major impact on the behaviour of the business. For example: inflation may cause a higher wage demand from employees (Herrigton, Kew & Kew; 2009).

Internal factors that must be addressed are poor industrial relations and human resource management. The company must also attract a greater proportion of the corporate market share from its competitors and reduce CO2 emissions to ease government and public pressures.

The climate of the economy dictates how consumers, suppliers and other organisational stakeholders such as suppliers and creditors behave within society. Economic factors represent the wider economy so may include economic growth rates, levels of employment and unemployment, costs of raw materials such as energy, petrol and steel, interest rates and monetary policies, exchange rates and inflation rates. These may also vary from one country to another. An economic factor in Clare's Chocolates was the scare of prices due to the recession. James was worried that increasing raw material costs together with the recession would badly affect his sales.

These external factors have several ways it can be affected such as economic, legal, and social as well. The way it affects economic growth, interest rates, and exchange rates, the interest rates affects the cost of what can extend a business to grow and expand. The exchange rates affect the costs of exporting supplies that are imported to a business. Legal external include discrimination laws, consumer law, employment law, health and safety law. Social can be affected by schools, careers, emphasis on safety.

A business organization cannot survive in its industry if it does not keep an eye on what is happening in its internal and external business environment. The analysis of business sector or environment acquaints an organization with the issues, challenges, and external factors that have a direct or indirect impact on its business operations and profitability. On the basis of this analysis, the organization can formulate its future strategies and compete in the industry in a more effective and vigilant manner (Cadle, Paul & Turner 2010).

These factors influence the internal environment of an organisation and they help in identifying the past and the present of the company, It also provides a frame work for reviewing strategy position and direction of the company.

The economy of each country has features that could be measured in different ways to see how they are changing. The economic environment of countries has an effect on countries due to the trading between countries affecting the money coming in and out of the country which then affects the cost of goods and prices.

The macro environment deals with the external and uncontrollable factors of a business. The macro environment helps the business with identifying it’s triple bottom line and can help them adjust necessary factors in their planning. The macro environment also includes analyzing different factors in the external environment, In order for the business to take the current issues and create strategies of their own on how to eliminate them for the benefit of their business. The macro environment will look at factors such as inflation, unemployment, spending and the gross domestic product.

Economic environment comprises of elements that influence by consumer buying power and spending patterns. Total buying power depends on current income, prices, savings, and credit (Kotler et al. 2013, p 131). The adjustment in average weekly earnings for each individual and the development in the Australian economy, which can be determined with Gross domestic product (GDP).