Definition of Business Environment
According to Davis, Keith: “ Environment of a business means the
aggregate of all conditions, events and influences that surround
and affect it.”
Main Features/ Nature of Business Environment:-
• Environment is the surrounding situation
• Environment is multi-faceted and dynamic
• It has a far reaching impact on business
• It needs adaptability
• Two broad components
• Environment is complex and uncertain
Inter- Relationship between Business and
Environment
Closely related concepts
Business has limited capacity to influence
environment
Continuous interaction with environment
Integrated approach to business environment
is a must for survival
BUSINESS ENVIRONMENT
INTERNAL EXTERNAL
COMPONENTS OF INTERNAL ENVIRONMENT
Goals of the organization
Value based management
Corporate image
Physical and Financial resources
Human Resources
Labour Relations
R&D facilities
Strong Financial Base
EXTERNAL ENVIRONMENT
MACRO
MICRO
Components of Micro Environment
Corporate Resources
Suppliers
Customers
Middlemen
Competitors
Society
Components of Macro Environment
Political
Economic
Social and Cultural
Technological
Legal
Ecological/ Natural
Demographic
International
Ethical
Educational Environment
Educational Environment is the economic
surrounding or situation within which the
education , training and manpower development
activities are undertaken. It is the education system
which creates human capital.
Features of educational environment in India
1. Influencing factors
2. Close connection with business
3. Business supports education
4. Position of educational environment in India
Impact of Education on Business
1. Growth of Professionalism in business
2. Change in attitude
3. Inflow of social skills in business
4. Trained leadership in business sector
5. Creativity and innovation in business
6. Ensures optimum utilization of resources in
business
Measures to improve standards in
education
Management Courses- high calibre
Sponsored educational institutions
Privatization and globalization in higher
education
Use of modern techniques
Training to teachers
Industry and Academics
Quality education
Measures to improve education
environment in India
Expenditure to be raised
Adequate opportunities
Literacy rate to be increased
Funds for research
Quality education
Autonomy
Vocational education and Skill development