Internal and external environments interact affect manager

The political and legal dimensions of the external environment include regulatory parameters within which an organization must operate.

importance of external environment

Changes in the external environment Lewin and Carroll U. The global dimension of the environment refers to factors in other countries that affect U. The second type of external environment is the indirectly interactive forces.

Businesses do not operate in a vacuum but rather in a dynamic environment that has a direct influence on how they operate and whether they will achieve their objectives.

Financial resources include capital used for financing the operations of the organization including working capital. Numerous firms have seen high level executives leave the company after credible charges had been leveled. Businesses today must deal with the unique shopping preferences of different generations, which each require marketing approaches and goods and services targeted to their needs.

Resources of the Organization. Even so, Mercedes has spent an enormous amount of time and effort to train its U. Since culture is an important internal environmental concern for an organization, managers need to understand its influence on organizational activities. But ill-management of the workforce could lead to a catastrophic situation for the company.

In the United States, laws passed by Congress and the many regulatory agencies cover such areas as competition, minimum wages, environmental protection, worker safety, and copyrights and patents. Productivity is the amount of goods and services one worker can produce.

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Understanding the Business Environment