Introduction to Management
Every organization must understand the external and internal forces within which they find themselves, so that they can exploit opportunities for growth or deal with threats that can lead to business failure (Bryson 2011, p. 150). The businessenvironment consists ofexternal and internal environment.
The external environment consists of task and general environment. The difference between task and general environment is that thetask environment has a more immediate impact on the organization whereas the general environment has a more distant impact. General environment include sociocultural, political and legal, technological, economic, and global influences. The sociocultural element is very important because it determines the goods, services and standards that society values. The political and legal forces include regulatory parameters within which an organization must operate. Political direction and stability is important for investor confidence. Tax policies and minimum wage legislation are a few examples of political and legal issues. The Economic Forces reflects the global financial conditions. Inflation, unemployment rates, and purchasing power are economic indicators that affect organizations. The greater the purchasing powers of consumers the more willing consumers are at paying the price for goods and services. The international forces refer to factors in other countries that affect the local organizations. Global environment presents new competitors, suppliers, and buyers to the local organization. Technological forces impacts organizations in unforeseeable ways. Industries are required to stay ahead of others and stay updated due to evolving technology or risk becoming outdated and suffering financially.Eastman KODAK, filed for bankruptcyin 2012, failed to move into the digital photography even after inventing the first digital camera in 1975 due to fear of hurting its own lucrative...