TABLE OF CONTENTS These simple models mentioned are, of course, much more complicated in the operational reality of business and commerce in action. Organizations are inseparably intertwined with their outside world the external environment.
This business environment, where all organizations conduct their enterprises, comprises a wide range of influences. These include:
the prevailing political climate; the macroeconomic situation; the legal framework; technological, educational, entertainment and sport; religion and organized crime (sociocultural); and
the availability of resources (scarcity), willingness of potential customers to trade, and the activities of any competitors.
The factors in the former group tend to have a slowly developing and general influence upon the enterprise whereas the ones in the latter group represent the day-to-day/operational influences.
These factors are discussed later in this chapter, but a short overview is provided here by highlighting some of the key external influences on businesses:
Different types of governments have different political aspirations, and manipulate economies to these ends. This manipulation will tend to influence the business environment. For example, in the early years of the twenty-first century, in Europe, there seems to be a significant political aspiration to combine national trading into an international trading block called the European Union. Governments are generally large organizations, and employers of large numbers of people.
Governments create (and sometimes destroy) macroeconomic climates conducive to investment. Policies to create high or low levels of public sector borrowing, higher or lower levels of employment, higher or lower...
