discuss the global environment in which businesses operate?

[bumblebee2212]

discuss the global environment in which businesses operate?

[Amazing]

Forces outside the firm’s traditional boundaries are increasingly important in determining the firm’s success. These forces in “the environment of business” differ among nations and over time, continually confronting the firm with new issues that require modifications in strategies and management practices. Managing in the context of turbulence has become an ongoing reality.These forces can be classified as :

1) Social forces
It represents personal relationships.For many cultures, personal relationships are built on an ongoing exchange of favours. Personal relationships and trust form a central determinant of success, both within the firm and in its external interactions.

2) Technological forces
Each nation, and each region within each nation, has its own unique innovation system that forms a key component of the environment of business. These innovation systems differ significantly, with some offering distinct advantages for the firms located there. This reality rests to a large degree on culture, social capital, education, and entrepreneurship.Advances in information technology have combined with innovations in microelectronics to create a host of new opportunities for e-business activities in every business sector.

3) Economical forces
Economic forces differ among nations and continually change over time. Analyses of their likely impacts and the creation of appropriate economic strategies can be the central determinant of a firm’s success. The attractiveness of a particular market depends on its industry structure, including the competitiveness of existing firms, the threat of substitutes and new entrants, and the bargaining power of suppliers and customers. New communication technologies have facilitated international outsourcing, enabling each firm to locate each activity in whatever country offers the optimal combination of cost, quality, and other attributes.

4) POLITICAL AND GOVERNMENTAL FORCES
Political and governmental forces are related to each of social, technological, and economic forces. These forces play a key role in the building of social capital, the fostering of entrepreneurship, and the facilitation of immigration. There are many ways through which cultural values shape political forces and through which interest groups influence government decisions.