BUSINESS ENVIRONMENT

Business Environment and Economics



Business Environment and Economics

Introduction

This final journal explores the three key points that I learned in business environment module of 10 units. Further it examines that why these are the key points. Then it identifies the relevance of my learning to my personal and professional experience. Moreover, the journal focuses that how these key points will prove to be beneficial in my future personal and professional experiences.

Discussion

Business Environment

I chose this as the first key point because a business cannot run in isolation; it needs customers, suppliers, workers and competitors in order to be successful. With an effort to success one must have an effective strategy, no matter what the nature of business is. The strategy can only be developed if one has in depth awareness of the business environment (Karres, 2010). However, there are two main elements in the business environment; internal factors and external factors. They both combined make a business environment.

The internal factors comprise of SWOT analysis is to perform two diagnoses (Ian and Chris, 2010)

An internal diagnostic that identifies the strengths and weaknesses of strategic activity. These can be determined using a series of strategic analysis models, such as value chain or analysis of the cultural fabric. It may be, for example technological portfolio, the level of notoriety, geographical presence, network of partners, the structure of corporate governance, etc.

An external assessment, which identifies opportunities and threats in the environment. These can be determined using a series of strategic analysis models, such the model of five competitive forces of Michael Porter value chain or scenario analysis. It can be for example the emergence of new competitors, the emergence of a new technology, the emergence of new regulations, opening new markets, etc.

We can compare this benefit: The perceived strengths and weaknesses of the company itself The perceived strengths and weaknesses of the company by its customers, competitors, suppliers and other external actors

However, the internal environment can be controlled by the business, so it holds a great significance. An organization must be aware of its goals and objectives in order to formulate strategies accordingly. Other important internal factors that have a great deal of impact on the business are human resource, marketing and leadership strategies.

Other element of business environment is External factors. Much research is needed to determine the external factors as they have a great influence on the business (Daniels et.al, 2010). These factors cannot be controlled by the business, thus organizations must conduct an extensive research and analysis. The most important analysis is PESTLE that gives an insight of political, economical, social, technological, environmental and legal forces that shapes the business. PESTEL analysis allows the organization to take preventive measures against the impact of rising inflation and increased taxation.

After learning these key points I can relate it to my professional and personal life too. As a matter of fact I did not conduct SWOT analysis in such detail, which may be the reason that I suffered ...