Contents
BUSINESS ENVIRONMENT............................................................................................................................3
TYPES OF ENVIRONMENT............................................................................................................................4
Technological Environment.........................................................................................................................5
Economic Environment................................................................................................................................5
Political Environment...................................................................................................................................5
Global or international Environment...........................................................................................................5
Social and culture Environment...................................................................................................................5
Characteristics of environment....................................................................................................................5
ENVIRONMENT – BUSINESS RELATIONS......................................................................................................6
IMPORTANCE OF ENVIRONMENTAL STUDY.................................................................................................6
ENVIRONMENTAL ANALYSIS PROCESS.........................................................................................................7
Scanning......................................................................................................................................................7
Monitoring...................................................................................................................................................7
Forecasting.................................................................................................................................................8
Assessment..................................................................................................................................................8
Environmental appraisal..............................................................................................................................8
Micro Environment Appraisal (Internal Appraisal)......................................................................................9
Important Factors for Environmental Scanning...........................................................................................9
Macro Environment Appraisal (External Appraisal)...................................................................................10
POLITICAL FACTORS...................................................................................................................................11
ECONOMIC FACTORS.................................................................................................................................11
SOCIAL FACTORS........................................................................................................................................12
TECHNOLOGICAL FACTORS........................................................................................................................12
ENVIRONMENTAL FACTORS.......................................................................................................................13
LEGAL FACTORS.........................................................................................................................................13
Porter's Five Forces....................................................................................................................................14
Advantages of Porter’s Five Forces analysis..............................................................................................16
Conclusion.................................................................................................................................................17
1
,2
, Discuss the relevance of appraising the
business environment
BUSINESS ENVIRONMENT
Environment refers to all external forces, which have a bearing on the functioning of business.
Environment factors “are largely if not totally, external and beyond the control of individual
industrial enterprises and their managements. The business environment poses threats to a firm
or offers immense opportunities for potential market exploitation.
3
BUSINESS ENVIRONMENT............................................................................................................................3
TYPES OF ENVIRONMENT............................................................................................................................4
Technological Environment.........................................................................................................................5
Economic Environment................................................................................................................................5
Political Environment...................................................................................................................................5
Global or international Environment...........................................................................................................5
Social and culture Environment...................................................................................................................5
Characteristics of environment....................................................................................................................5
ENVIRONMENT – BUSINESS RELATIONS......................................................................................................6
IMPORTANCE OF ENVIRONMENTAL STUDY.................................................................................................6
ENVIRONMENTAL ANALYSIS PROCESS.........................................................................................................7
Scanning......................................................................................................................................................7
Monitoring...................................................................................................................................................7
Forecasting.................................................................................................................................................8
Assessment..................................................................................................................................................8
Environmental appraisal..............................................................................................................................8
Micro Environment Appraisal (Internal Appraisal)......................................................................................9
Important Factors for Environmental Scanning...........................................................................................9
Macro Environment Appraisal (External Appraisal)...................................................................................10
POLITICAL FACTORS...................................................................................................................................11
ECONOMIC FACTORS.................................................................................................................................11
SOCIAL FACTORS........................................................................................................................................12
TECHNOLOGICAL FACTORS........................................................................................................................12
ENVIRONMENTAL FACTORS.......................................................................................................................13
LEGAL FACTORS.........................................................................................................................................13
Porter's Five Forces....................................................................................................................................14
Advantages of Porter’s Five Forces analysis..............................................................................................16
Conclusion.................................................................................................................................................17
1
,2
, Discuss the relevance of appraising the
business environment
BUSINESS ENVIRONMENT
Environment refers to all external forces, which have a bearing on the functioning of business.
Environment factors “are largely if not totally, external and beyond the control of individual
industrial enterprises and their managements. The business environment poses threats to a firm
or offers immense opportunities for potential market exploitation.
3
