Summary Chapter 4: External Environment and Organizational Culture

MANAGEMENT 1.1
CHAPTER 4
EXTERNAL ENVIRONMENT AND ORGANIZATIONAL CULTURE


TAKEWAY 1: The External Environment
The general or macroenvironment — consists of economic, legal-political,
sociocultural, technological and natural environment conditions in which the
organization operates.

Economic
health of the economy

Legal-political
philosophy/objectives of political party running the government

Socio-cultural
norms, customs, social values

Technological
development and availability of technology

Natural environment
nature and conditions of environment

, MANAGEMENT 1.1
CHAPTER 4
Economic conditions
– Overall health of economy in terms of financial markets, inflation,
income levels, and job outlook
– Offshoring  outsourcing of jobs to foreign locations
– Reshoring  return of jobs from foreign locations
Legal-political conditions
– Laws and regulations, government policies, and the objectives of
political parties
– Vary from one country to the next
– Internet censorship - deliberate blockage of public access to
information posted on the Internet
Sociocultural conditions
– Diversity issues relating to educational opportunity, access to
technology, housing/job options
– Norms, customs, demographics, and societal values
– Generational cohorts  people born within a few years of one another
and who experience somewhat similar life events during their formative
years
Technological conditions
– Social media, features and “apps” on smart phones
– Brings both opportunities and problems
– Work-life balance
Natural environment conditions
– Nuclear plant failure, oil spill, hurricane
– “Carbon neutral,” “green”, “sustainability”
– Sustainable business – meets both the needs of customers and
protects the natural environment