Importance Of Environmental Factors In Business
Environment means surrounding. Business establishes grows or operates and dies in an environment. It exchanges resources in the environment. It collects inputs i.e. man money, materials, machines etc. and provides output i.e. goods and services in the environment. There are events or situations that occur and affect the way a business operates, either in a positive or a negative way and are called as an 'environmental factors. '
There are two types of environmental factors: internal environmental factors and external environmental factors. Internal environmental factors are events that occur within an organization. Generally speaking, internal environmental factors are easier to control than external environmental factors. External
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Basis of Decisions: It provides all the necessary information for taking good decision. It helps in brand building, product positioning and market penetration.
Help in Making Policies: It forms the strong base for making strong policies.
Technological Planning: In today’s world technology is changing at the lighting speed, so understanding the environment can helps make better technological plans.
Survive in the Business: Only that business will survive and success who has estimated the situation like recession in advance through business environment study
1.3 WHAT IS A BUSINESS?
A commercial activity engaged in as a means of livelihood or profit, or an entity which engages in such activities is known as business or is an economic activity, which is related with continuous and regular production and distribution of goods and services for satisfying human
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An organization mission statement reveals the organization’s intention to secure its survival through development growth and profitability of the business. It is basic and implied objectives of the most organizations. It is of utmost importance at the time of beginning of a venture and in economic downturn. All types of enterprises will be interested in more than mere survival in market.
Stability
Stability is one of an important, cautious and conservative objective of firm. A good and steady enterprise always minimizes its managerial tensions and reduces its dynamic nature decisions which are taken from managers for managing business. It is less susceptible to the resistance and hostility of external environment. It requires comparatively less managerial efforts and
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