Describe the organizations general environment

1686 words (7 pages) Essay in Business

5/12/16 Business Reference this

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The general environment of an organization refers to a range of factors or forces outside an organization that may influence the performance and operation of a business. When compared to a firm’s task environment, the impact of these dimensions is less direct. Key dimensions of the environment that bear on the institution include the economic context, technology context, sociocultural context, political-legal context, and international context. An analysis of all this dimensions are an attempt to understand the conditions outside its boundaries and help to shape how the organization defines itself and how it articulates what is good and appropriate to achieve. Managers of the organization do consider all the aspects of the general environment as the plan, organize, lead and control all the operation of the organization.

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In the economic dimension, the organizational analysis should focus on those areas of the economic system that directly impact the type of project being considered. The economic dimension consists of factors that may affect the purchasing power and spending patterns of the consumer. It also reflects worldwide financial conditions. Certain economic factors of special concern to the organization include interest rates, inflation, unemployment rates, disposable income, recession, tax systems, commodity prices, monetary and fiscal policies, internal regulation and bureaucracy and exchange rates. Changes in major economic may have a great impact on the marketplace. Improved economic conditions naturally create an increased demand for products and services, thus stimulating additional opportunities for organizational growth. Consumer income affects consumer spending which affects sales for an organization. During an undesirable economic climate, generally, most of the consumer will spend less than they used to be. For example, economic crisis is happening now in Britain, the government is cutting their budget, which they are planning in four years times, they should be able to cut 83 billion pounds of government spending. This will lead to the retrenchment of the government servants. This bad situation happened due to the share market is over speculated and housing bubble happening in Britain. This may affect the income of the customers and in the same way affect the industry of education. This may lead to the industry of the education will have fewer students because the percentage of the income spend on education is lower. Apparently, this will pose a track to the university because of their ability to gain access to the necessary funds and resources (excellent lecturers, facilities and equipment) of their organization needs have become limited.

In today’s era, technology plays an important role in every aspects of our life. An organization in a country is greatly affected by the technological development. Technology has a tremendous effect on life-style, consumption patterns, and the economy of a country. Technology has changed the fundamental ways that an organization is structured and the ways that managers run the organization. Advances in technology have a great impact on industries for example it can commence new industries, alter or destroy existing industries. The rapid rate at which today’s technology changes has made most of the organization to quickly adapt in terms of how they manage the organization. The technology adopted by the industry determines the type and quality of goods and services to be produced and the type and quality of equipment to be used. The rapid technological developments are manageable and yet uncontrollable force faced by most of the marketers. It is important for organization to keep on its toes all the time looking for constant change and to always try to be alert of the new technologies in order for them to turn these advances into opportunities to make profit for the organization. To determine the success of an organization, we will have to look at how well they identify and respond to the external technological changes. The University of Manchester is popular for its advance technology for example, virtual learning environment (VLE) called Blackboard in the university is reflection of the technological dimension. Many study programmes offered in the university include assessed online components. Blackboard virtual learning environment allows the students to study online using resources created by their lecturers or professors, they can also download papers and take online tests in it, or access to any relevant audio- or video- visual materials. E-Learning can be used as the main method of delivering notes or any information that is necessary for the students, which is more usually combined with classroom-based teaching.

The sociocultural dimension is concerned with the society’s attitudes and cultural values. It is especially important because it determines the goods, services and standards that society is likely to values. In a market economy, businesses must ultimately respond to what consumers want if they are to succeed. It is important when the organization conducts its business, it will need to do so in a way that respects and bear in mind the fact that sociocultural environment is characterized by different people in a market and therefore it has to conduct it business in a way that respect and accommodate this environment. Failure to do so will result in bad publicity, losses of the profit of the organization and even to end the business operation. Consumer demands change continually, influenced by a whole range of factors, including fashion, culture, the influence of the media, changing social attitudes, increased income levels, new technologies and better information flows. Consumer’s buying patterns are greatly affected by the changes in the structure of the population, and in consumer lifestyles. Demographic factors e.g. age, gender, race, religion, etc. all determine the buying patterns and to understand such changes is critical for developing strategies which are in line with the market situations. Business that anticipate significant trends in consumer tastes and capitalize on them early can often gain a major advantage over competitors. The nature of goods and the type of services to be produced by an organization depends upon the demands of the people which in turn are affected by their attitudes, customs, so as cultural value. For example, it is important for The University of Manchester to look into the detail of which courses are famous and popular at one time and people tend to follow the trends for a particular of time and the university will gain lots of advantage from it if it tries it’s best to promote that specific course. For instances, computer science was once a famous course for the youngster to pursue and after sometime people found that it was not in demand anymore and currently lots of young adults are pursuing engineering programs which is highly in demand in the society now. Since Britain is an English speaking country, where usually worldwide students will go there and further their studies. It can use various way to attract students for example, China is a wealthy country, it can find some wat to attract the Chinese students to continue their studies in their country which can help them to make profit. Ways that could make the Chinese students comfortably study in Britain is making Chinese speaking road sign, special official who can speak fluent mandarin or any events that could include the Chinese students.

The political-legal environment dimension of the general environment refers to the philosophy of the political parties in power influences business practices. The political-legal environment serves to define what organizations can and cannot do at a particular point in time. Local governments have the ability to influence business activity significantly. It is the federal government that passes and enforces legislation in the areas of consumerism, employee relations, the environment, and the competitive practices. Regulations that have been passed by the federal government concerning the operation of the business vary between states and countries. The legal perspective has become more difficult for most of the business to take action without encountering a law, regulation or legal situation. Although organizations spend a great deal of money and time to meet the governmental regulations, the effects go beyond time and money; they reduce managerial discretion by limiting available choices. For instance, government policy is playing an important role that may affect the decision made by students as to whether they want to pursue their studies in University of Manchester or not. Government’s policy greatly affects the tuition fees, for example, oversee students pay more than 100 % than the local students but if the oversee students come to enroll in the program with good grades, he or she will only have to pay 50 % for the course. Working as a part time working, special offer for travelling around, students don’t have to pay so much for their visa or the period of time to work after graduate from the university are all part of the incentive given to the students by the government.

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The international dimension is the final component of the general environment. It is actions of other countries or groups of countries that affect the operation of the organization. Changes in international relationship, changes in nations’ economics, political and legal systems, and changes in technology are the outcomes of the global forces. Increasing in the economic integration of countries around the world will reduce the barrier of free flow of goods and service imported and exported between nations.

Although organization use the basic management functions of planning, organizing, leading, and controlling in every form of the business to operates domestically or internationally, managers do encounter problems and risks on an international scale. For example, country currency is something which the students may consider whether they should study in University of Manchester in Britain. If the country currency increases, this may greatly affect the number of students to study in their country and they will consider further their studies in other country which has a reasonable price. Another factor is the study system has to be up to the world standard so that when the graduates have gone for interview for a job, the degree they are holding will be recognized. Other than that, excessive racial discrimination also can affect the international students to study there.

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