The managerial environment- P1
Managerial environment includes task environment and general environment.
General environment
The general environment includes the wide-ranging global, economic, technological, socio- cultural, demographic, political, and legal forces that affect the organization and its task environment. Opportunities and threats result from changes in the general environment are often more difficult to identify and respond to than are events in the task environment. However, changes in these forces can have major impacts on managers and their organizations. Managers must constantly analyze forces in the general environment because these forces affect ongoing decision making and planning.
1. Economic Forces
Economic forces affect the general health and well-being of a country or world region. They include interest rates, inflation, unemployment, and economic growth. Economic forces produce many opportunities and threats for managers. Good economic times create the opportunities that give people more money to spend, organization expand their capacity to sell goods and services, resources become easier to acquire, and organizations have an opportunity to flourish. In contrast, worsening macroeconomic conditions pose a major threat because they limit managers’ ability to gain access to the resources their organizations need, organizations have fewer customer to buy their products. Poor economic conditions make the environment more complex and managers’ job more difficult and demanding. Managers need to identify ways to acquire and utilize resources more efficiently, realize the importance of economic forces on organizations’ performance and pay close attention to what is occurring in the national and regional economies to respond appropriately.
2. Technological Forces
Technological is the combination of tools, machines, computers, skills, information, and knowledge that managers use in the design, production, and distribution of goods and services. Technological forces are outcomes of changes in the technology that managers use to design, produce, or distribute goods and services.
Technological forces can have profound implications for managers and organizations. Technological change can make established products obsolete, force managers to find new ways to satisfy customer needs. Although technological change can threaten an organization, it also can create a host of new opportunities for designing, making, or distributing new and better kinds of goods and services. Changes in IT are the very nature of work itself within organizations, including that of the manager’s job.
3. Socio-cultural Forces
Socio-cultural forces are pressures emanating from the social structure of a country or society or from the national culture. Pressure from both sources can wither constrain or facilitate the way organizations operate and managers behave.
Societies also differ in the extent to which they emphasize the individual over the group. This difference may dictate the methods managers need to use to motivate and lead employees. Social structure and national culture not only differ across societies but also change within societies over time. Managers must be responsive to changes in, and differences among, the social structures and national cultures of all the countries in which they operate. In today’s increasingly integrated global economy, managers are likely to interact with people from several countries. Effective managers are sensitive to differences between societies and adjust their behaviors accordingly.
4. Demographic Forces
Demographic forces are the outcomes of changes in, or changing attitudes toward, the characteristics of a population, such as age, gender, ethnic origin, race, sexual orientation, and social class. Demographic forces present managers with opportunities and threats and can have major implications for organizations. Managers have to realize the demographic features of every country the company operate or want to enter to ensure that their products and services are suitable. In addition, organizations need to find ways to motivate and utilize the skills and knowledge of older employees, an issue that many Western societies have yet to tackle.
5. Political and Legal Forces
Political and legal forces are outcomes of changes in laws and regulations such as the deregulation of industries, the privatization of organizations, and the increased emphasis on environmental protection. Laws constrain the operations of organizations and managers, and thus create both opportunities and threats. The country with the stable and open political and legal forces can create a huge opportunities for the company’s profitability. In contrast, managers have to pay attention on the countries with the country with strict legal forces as well as the unstable politic. Another important political and legal force affecting managers and organizations is the political integration of countries that has been taking place during the past decades. In addition, international agreements to abolish laws and regulations that restrict and reduce trade between countries have been having profound effects on global organizations.
Nguyen Thi My My
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