Does the External Environment Determine the Success or Failure of an Organization?

Does the External Environment Determine the Success or Failure of an Organization?

  • Submitted By: bb19921016
  • Date Submitted: 05/07/2013 1:12 AM
  • Category: Business
  • Words: 1657
  • Page: 7
  • Views: 6

The external environment normally refers to outside forces that may influence an organization. There are two kinds of environment of external environment which are specific environment and general environment. General environment including politico factors, legal factors, economic factors, technological factors , socio cultural and international forces . Specific environment is directly relevant to the achievement of an organization's aim, in which includes consumers, suppliers, competitors and pressure groups. This paper will show the relationships between the external environment and the success and failures of an organization. Although external environment can impact the business, it cannot be determine the success or failure of business. This paper will use Hong- Kong-based McDonalds as an example.

The external environment affects managers in different ways base on its degree of changes and complication. If the changes large, it is more difficult for the company managers to make decisions based on the predict of the environment. Managers make a lot of different decision to help to construct relationships with the stakeholders which in turn influence the company outcome. (Management, 2002, p. 77 & 78). For instance, when a company is facing a stable environment, it should use a mechanistic organizational structure. However, when a company is facing rapidly changing environments , it should use an organic form . (Tom Burns, George Stalker, Paul Lawrence and Jay Lorsch).

The customers consuming behaviors was affected by the sociocultural which include culture and social trends. One of the important roles of the sociocultural conditions is the culture of food. According to the Results of the 2009/10 Household Expenditure Survey(Hong Kong Digest of Statistics), Most Hong Kong resident paid a large amount of income for the food expenditure which is second highest expenditure after the expenditure of housing. They spent around 27.5 % of their monthly income...

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