I NTRODUCTI ON TO BUSI NESS POLI CY

AND ENVI RONMENT

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Poonam Khurana (Course Facilitator)
Involves production, distribution or exchange of goods or
rendering of services.
To earn profit or to earn a living.
Led to creation of utility.
WHAT DO YOU UNDERSTAND BY BUSI NESS??
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Survival
Growth
Social
Responsibility
Profit
OBJ ECTI VES OF BUSI NESS
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BUSI NESS CHALLENGES
Meeting stakeholders expectations
Developing and retaining top talent
Creating a customer responsive organization
Diminishing time to market
Market agility
Pricing and quality
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BUSI NESS POLI CY
Plans or rule of action
General statements of principles
Which guide thinking, decision making and actions of
organizations.
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WHAT DO YOU MEAN BY BUSI NESS
ENVI RONMENT???
The environment of any organization is:
the aggregate of
all conditions, events and influences
that surround and affect it.
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Complex
Dynamic
Multi-faceted
Far- reaching impact
CHARACTERI STI CS OF BUSI NESS
ENVI RONMENT:
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WHY STUDY BUSI NESS ENVI RONMENT
Development of broad strategies to ensure sustainability
To foresee the impact of various factor changes at the national
and international levels on firms ability.
Analysis of competitors strategies and formulation of effective
counter measures.
To keep oneself dynamic
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TYPES OF ENVI RONMENT
Internal Environment
External Environment
Micro environment
Macro environment

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Queries can be addressed to poonam@pcte.edu.in
I NTERNAL ENVI RONMENT
Refers to all the factors that are within an organization which
impart strengths or cause weaknesses of strategic nature.

Controllable factors.


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These include:
Value system
Vision, Mission and Objectives
Management Structure and Nature
Internal power relationship
Human Resources
Company Image and Brand Equity

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EXTERNAL ENVI RONMENT
Includes all factors outside the organization which provide
opportunities or pose threats to the organization

Uncontrollable factors

Consists of Micro and Macro environment
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Micro Environment
It consists of the factors in the companys immediate
environment that affect the performance of the company.

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Micro Environment Factors
Suppliers
Customers
Marketing Intermediaries
Competitors
Publics
Financiers

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Macro Environment
It comprises general trends and forces that may not
immediately affect the organization but sooner or later will
alter the way organization operates.

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Macro Environment Factors
Political Factors
Economic Factors
Social or Socio-cultural Factors
Technological Factors
Legal Factors
Environmental Factors
Demographic Factors
Natural Factors
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Political parties in power
Political Philosophy
Political Factors
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Economic Factors
Economic stages that exists at a given time in a country
Economic system that is adopted by a country: Capitalistic,
Socialistic or Mixed Economy
Economic planning: Five Year Plans, Budgets, etc.
Economic policies: Monetary, Industrial and Fiscal Policies
Economic Indices: National Income, Per Capital Income,
Balance of Payments etc.
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Social Customs & Rituals and practices
Lifestyle patterns
Family structure
Role & position of men, women, children and
aged in family & society
Socio-Cultural Factors
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Sources of technology
Technological development
Impact of technology
Technological Factors
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Constitutional framework
Policies relating to pricing and foreign investment
Policies related to the public sector, SSIs, development of
backward areas.





Legal Factors
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Environmental Factors
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Growth of population
Age Composition
Life Expectancy
Gender Ratio
Fertility and Mortality rates
Inter-state migration



Demographic Factors
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Natural Factors
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Queries can be addressed to poonam@pcte.edu.in