commercial economics lectures 3-4 1 the external environment the external environment

Commercial Economics LeCommercial Economics Lectures 3-4ctures 3-4

11

The External EnvironmentThe External Environment


22

Defining the External EnvironmentDefining the External Environment

External EnvironmentExternal Environment

Those factors and forces outside the Those factors and forces outside the organization that affect the organization’s organization that affect the organization’s performance. performance.

Components of the External EnvironmentComponents of the External Environment

Specific environment:Specific environment: external forces external forces that have a direct and immediate impact that have a direct and immediate impact on the organization.on the organization.

General environment:General environment: broad economic, broad economic, socio-cultural, political/legal, socio-cultural, political/legal, demographic, technological, and global demographic, technological, and global conditions that conditions that maymay affect the affect the organization.organization.


33


44

Parameters of Managerial DiscretionParameters of Managerial Discretion


55

Logistic Function Organisation

Funcţie realizată prin resurse interne

Funcţie realizată prin contractare externă

Alianţă pentru performanţă în afaceri

Integrare funcţională sporităAutonomie operaţională sporită

4PL

Client

Client

Client Compartimente logistice

3PL

3PL

Furnizor de servicii

Firmă de consultanţă

Funcţie realizată prin resurse interne

Funcţie realizată prin contractare externă

Alianţă pentru performanţă în afaceri

Integrare funcţională sporităAutonomie operaţională sporită

4PL

Client

Client

Client Compartimente logistice

3PL

3PL

Furnizor de servicii

Firmă de consultanţă


66

Implications of the Implications of the Systems ApproachSystems Approach

Coordination Coordination of the organization’s of the organization’s parts is essential for proper parts is essential for proper functioning of the entire functioning of the entire organization.organization.

Decisions and actionsDecisions and actions taken in one taken in one area of the organization will have area of the organization will have an effect in other areas of the an effect in other areas of the organization.organization.

Organizations are not self-Organizations are not self-contained and, therefore, must contained and, therefore, must adapt to changesadapt to changes in their external in their external environment.environment.


77

The Contingency The Contingency ApproachApproach

Contingency Approach DefinedContingency Approach Defined

Also sometimes called the Also sometimes called the situational approach.situational approach.

There is no one universally There is no one universally applicable set of management applicable set of management principles (rules) by which to principles (rules) by which to manage organizations.manage organizations.

Organizations are individually Organizations are individually different, face different situations different, face different situations (contingency variables), and require (contingency variables), and require different ways of managing.different ways of managing.


88

Popular Contingency Popular Contingency VariablesVariables

• Organization size• As size increases, so do the problems of

coordination.

• Routineness of task technology• Routine technologies require

organizational structures, leadership styles, and control systems that differ from those required by customized or

nonroutine technologies.

• Environmental uncertainty• What works best in a stable and

predictable environment may be totally inappropriate in a rapidly changing and unpredictable environment.

• Individual differences• Individuals differ in terms of their desire

for growth, autonomy, tolerance of ambiguity, and expectations.


99

Current Trends and Current Trends and IssuesIssues

GlobalizationGlobalization EthicsEthics Workforce DiversityWorkforce Diversity EntrepreneurshipEntrepreneurship E-businessE-business Knowledge ManagementKnowledge Management Learning OrganizationsLearning Organizations Quality ManagementQuality Management


1010

How Organizations Go GlobalHow Organizations Go Global


1111

Current Trends and Current Trends and Issues (cont’d)Issues (cont’d)

GlobalizationGlobalization Management in international Management in international

organizationsorganizations Political and cultural challenges of Political and cultural challenges of

operating in a global marketoperating in a global market Working with people from different culturesWorking with people from different cultures Coping with anticapitalist backlashCoping with anticapitalist backlash Movement of jobs to countries with low-Movement of jobs to countries with low-

cost laborcost labor

EthicsEthics Increased emphasis on ethics education Increased emphasis on ethics education

in college curriculumsin college curriculums Increased creation and use of codes of Increased creation and use of codes of

ethics by businessesethics by businesses


1212

Categories of E-Business InvolvementCategories of E-Business Involvement


1313

Distribution and Technology Organisation


1414

Dimensions of Organizational CultureDimensions of Organizational Culture


1515

Spirituality and Spirituality and Organizational CultureOrganizational Culture

Workplace SpiritualityWorkplace Spirituality The recognition that people have an inner The recognition that people have an inner

life that nourishes and is nourished by life that nourishes and is nourished by meaningful work that takes place in the meaningful work that takes place in the context of community.context of community.

Characteristics of a Spiritual OrganizationCharacteristics of a Spiritual Organization Strong sense of purposeStrong sense of purpose Focus on individual developmentFocus on individual development Trust and opennessTrust and openness Employee empowermentEmployee empowerment Toleration of employees’ expressionToleration of employees’ expression


1616

Benefits of SpiritualityBenefits of Spirituality

Improved employee productivityImproved employee productivity Reduction of employee turnoverReduction of employee turnover Stronger organizational Stronger organizational

performanceperformance Increased creativityIncreased creativity Increased employee satisfactionIncreased employee satisfaction Increased team performanceIncreased team performance Increased organizational Increased organizational

performanceperformance

commercial economics lectures 3-4 1 the external environment the external environment

Documents

entire organization

external forces

organizations parts

organizations performance

general environment

unpredictable environment

different culturescoping

current trends