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What is organizational environment? Basically, organizational environment are included two factors, internal environment and external environment. Internal environment also was called as micro environment; on the other hand external environment was also called as macro environment. Internal environment is mean that the general conditions that exist within an organization and it relate to the culture and climate of the organization. Besides that, internal environment is containing internal customer and internal factor. For internal factor, it contain strength and weakness it is an analysis that to identify and analyze the strength and weakness within the company. Put simply, it is looking and analyzing the strengths and weaknesses of the organization itself and there are been controllable and changeable. The strength and weakness is evaluated the company's resource and performance internally. For example, the financial system of the company, labour resource of the company, the way of management of the company and so on. Besides that, internal customer was also playing an important role to a company. This is because the internal customer was influence the performance and production of a company itself.
Next, external environment is mean that the condition, entities and factor surrounding a company which impact the decision making, activities and choice and determine its opportunities and threats. External environment was contains external factor. For external factor, it contains opportunity and thread. Opportunity and threat is a factor that is beyond the control of the company, these factors will be influencing the decision making of a company. The factor will pose either an opportunity or threat. Opportunities is refer that external chances to make greater sales or profits in the environment, threat is refer to the external elements in the environment that could cause trouble for the business of a company itself. For example the opportunities and threats that the company unable to control such as, political factors, economical factors, social factors, technological factors and competitors. Sometime these factors will create an opportunities or threats to a company, and the company will take the opportunities or avoid the threats.
Environmental analysis is very important to an organization. So, what is environmental analysis? Environmental analysis is an analysis that to evaluate the possibility effect to external forces and conditions on an organization's survival and develop strategies. Environmental Analysis can mean lots of things such as regulatory compliance, resource management, environmental protection, and workplace safety. The function of environmental analysis is to identify trends or outside forces that may influence upon the success or failure of a particular business. So, a company always need to conduct environment analysis to identify what would actually happened outside of the company itself and check whether opportunities or threats that the company is facing.
One of a small local business proprietor in my area that the writer had interviewed is a clothing shop. This clothing shop was located in City Square shopping Complex Johor Bahru. The shop's name is St. Honore, it located in 3th floor of the City Square Shopping Complex. The shop owner is Chong Chee Lin; he is a boss of this shop. This clothing shop is provides male and female clothing, there are casual wear, formal wear, clothing accessories and caps to the customer. So, whatever the customer is male or female, they can purchase their like clothing in this shop. For the internal customer, the owner of the shop has had hired few retail salesperson and tailor to operate the business. For the product, the product is come from different suppliers and some of the product was been purchased from foreign country such as China, Taiwan, Hongkong and so on.
The following below is the SWOT analysis report and the questionnaires that I had interviewed to the shop's owner. Thus, when the writer are tabulated the questionnaires and categorized the questionnaires into strengths, weakness, opportunities and threats form.
Does the customers are satisfied the price of the product? Does the customers are satisfied the quality and design of the cloths?
Every customer's body size is different, so if the customer is facing the some sizes problem such as the sizes are not suitable enough and trousers is too long of the product can you solve the problem?
Did you have your own branded cloths? And the other shop will have had the similar product with your shop?
Besides that the female and male adult cloths, do you have provides baby cloths to the customers?
Do the suppliers will give discount to you when you are order in buck of goods from them?
Have City Square Shopping Complex ever organized fashion event to promote fashion trend?
As we knew, there are lots of fashion shops that located in City Square Shopping Complex; do the competitors impact to the sales of this shop?
The rental proposal is limited, each shop has got one rental proposal from the top management of City Square, so when the deadline of the rental proposal is expired, the shop's owner need to reapply in order to keep rent the place. From here, was this situation influence to your shop?
Based on the writer interviewed to the shop, there are some resources that the writer gets. So, the following below is the full set of statement of the shop's owner.
According to the questionnaires that the writer given to the shop's owner, the owner has had answered the questionnaires. For internal factor, most of the customers a satisfied the price of the product itself. This shop is using fixed price for the price method, the customer unable to get discount when purchasing the cloths this is because the price of the product is popular and most of the customers are acceptable. In this shop there are several loyal customers that always coming this shop and buy the product. For the quality of the product, most of the customers are claim that the products of this shop is good enough, no matter the color of cloths durability and comfort of the cloths it was be given good comment by the customers. Compare the other shops; this shop is better than most of the other shops as the price and quality are met to the desire of the consumers.
Next, this shop also contains clothing alteration services, a profession tailor is working in this shop and the tailor's job is altering the cloths. When the customers are felt that the size of the cloth or trouser of the pants is not suitable and fitting they can enjoy alteration in this shop for free.
Furthermore, the weaknesses of this shop is no well-known branded cloths be provides in this shop. The consumer will consider that the quality of the products of this shop is not good enough and the consumers will go to other well-known branded clothing shop to buy what cloths they want, it cause this shop are loss of profit.
Besides that, another weakness of this shop is not provided baby cloth to consumers. In this case, some of the consumers are go to other shop to look for baby cloths, so marketing myopia is occur in this shop. This weakness will cause this shop are losing profit from the consumers as they did not provided baby clothing to the consumers.
Apart from this, the external factor of the analysis is opportunities and threat. Firstly, one of the opportunities of this shop City Square always organized fashion event and fashion promotion to attract more consumers having shopping at City Square, this shop can take this opportunity to promote the product toward the consumers, so that the consumers will being attracted and will purchase the cloth from this shop as they like.
Another opportunity is this shop is enjoying the discount given by the supplier. Typically the boss was buying and order in buck of the goods from the supplier, the supplier was giving considerable discount rate to this shop. Besides that, the relationship between the supplier and the shop's owner is close as the shop's owner was the loyal customer of the supplier, the supplier always gives discount to this shop. However, the supplier are given the discount to this shop is privately as other shop are also was the customer of the supplier. The supplier is only give discount in goods for this shop. It created opportunity to St. Honore clothing shop.
Lastly, one of the threats that are shop facing is too much of competitors selling same categorizes of product. From this situation, the consumer will became more choice to select the shop to buy the cloths. So, it causes a risk to this shop as the competitors are selling similar products with it.
Another threat is the time period of rental proposal is limited. It will cause the shop will being close up when the rental proposal was expired, so the boss will have to update the proposal. From here, if other business wanted to take place in this location to running business, the top management will decide which people can take place this location based on the bid of these people. Thus, the highest the price are offer by who, who will get the rent. It was a threat to this shop.
Based on the weaknesses and threats of this shop the writer has to suggest some solution to correct and solve the weaknesses and threats to the shop's owner.
For the weaknesses, the boss may try to import and buy in some baby clothes in the shop to sell these baby clothes. So, this shop will being diversity series of products to attract more customers to come in for buying the products. Thus, this shop also needs to inform to the consumer there are new arrival baby cloths available in the shop by advertising through internet and leaflets. After period of time, most of the consumers are has been informed that this shop is selling baby cloths and they will purchase the cloth as the like and will become the loyal customer if the services of the workers and the quality of the products are good enough.
The way possibility to avoid the threats is the shop's owner has to conduct marketing research toward the competitors in order to check the pricing and quality of the products whether is better than the shop itself or not. This will make the shop's owner become more rational to setting the price and select what kind of goods from the suppliers. It makes easier to sell the products to the customers of the shop itself. Another way possibility to avoid the threat is taking the next rental proposal early from the top management. This is mean that the in order to get continue to rent the place and prepare the sign up the proposal early than the expired date of the rental proposal from the top management.
In this project, the writer had learned many things and gained much knowledge from carry out the questionnaires to the business. First, the writer had learned how to design a questionnaires to the business, how to related the questionnaires to the SWOT analysis. For the SWOT analysis, the writer was knew how to categorized the situation in to strength, weakness, opportunity and threat. So, the writer also provided some solution and ways that possibility to solve and avoid the weaknesses and threats that a business is facing.
Besides that, the writer also had gained the knowledge that how to operate and run a business effectively by strengthening and emphasizing the strength and opportunity of the internal environment and external environment. The writer also gets many useful information and details based on the internet research and asking to lecturer. The useful information and details such as definition of organizational environment, internal factor, external factor and so on. These information and details is very useful to academic and also useful to a business too.
As a result, a business wanted to run the business effectively, it needs to identify what actually strengths and opportunity it have and what actually weaknesses and threats it facing. Therefore, try to correct the defects.