Tiêu đề MCO 4 Santosh Sir EM Notes @UpToDateWithUpdates.pdf ✅

Santosh Kumar Sharma BUSINESS ENVIRONMENT MCO-04 MCOM (IGNOU) STUDY MATERIALS


SANTOSH KUMAR SHARMA 2 2) Specific and General Forces: A business environment includes both specific and general forces. Specific forces are those forces which directly affect the operational activities of the business enterprise. For example, suppliers, customers, investors, competitors, financers etc. Whereas, General forces are those forces which indirectly affect the functioning of business enterprises. For example, economic, social, political, legal and technological factors. 3) Inter-relatedness: Different forces of business environment are interrelated to each other. One component of the business environment affects the functioning of other components. For example, change in the political factors will affect the economic and legal environment. Because different governments have different objects and they change the systems accordingly. 4) Dynamic Nature: The business environment is dynamic in nature and keeps on changing with time and conditions. For example, change in the technology, consumers demand, government policies, etc. change the business environment too. Thus, environment is quite sensitive and flexible. These are just like “Touch me not plant” which changes with a slight touch. 5) Uncertainty: The changes in the business environment cannot be predicted accurately because of future uncertainties. Anything can happen in future. Future is risky and uncertain. This makes the environment uncertain. We can only guess but the real outcomes may be favourable or unfavourable. It is very difficult to predict the future. 6) Complexity: All the forces of the business environment are interrelated and dynamic, which makes it difficult to understand. There are so many types of environments and studying the behaviour of each is a very complex task. Therefore, companies take the help of experts and professionals to study the dynamic environment. 7) Relativity: Business Environment differs from place to place, region to region and country to country. It is not the same everywhere. Because different places have different type of people, language, living styles, demands, etc. Thus, these factors make the business environment relative to one another. It means they are different but relative. Types of Business Environment Business environment can be classified into two broad categories, such as: A. Micro Environment B. Macro Environment A) Micro Environment: Those environments which are in direct contact with a company are called micro environment. These are very close to a company. They influence the working of a firm directly. These are basically of five types such as, suppliers, competitors, general public and customers. Components of Micro Environment 1. Customers 2. Competitors 3. Suppliers 4. Workers 5. Public 1) Customers: Customers are God for business. It is very important for the success of a business to understand and monitor the tastes and preferences of the consumers. There are various categories of customers like individuals, households, business firms, government and other institutions. 2) Competitors: In this world of competition, no business firm enjoys monopoly in the market. Therefore, to sustain in the market it is very important for a firm to know its competitors’ strengths and weaknesses. 3) Suppliers: Those individuals and firms which provide inputs like raw materials are called suppliers. Therefore, it is very important for a company to know the available suppliers near its production units so that its production process goes on smoothly.