Question

How business environment influences business management?

Answer 1

Business is affected by different factors which collectively form the business environment. These include economic, social, legal, technological and political factors. Business environment is therefore, the total of all external forces, which affect the organization and the business operations (Kotler &Armstrong 2004).

Answer 2

Business environment influences business management by these factors:

• Geographical and Ecological or Natural Factors.
• Political and Legal Environment.
• Physical and Technological Environment.
• Supply of Natural Resources.
• Demographic Environment.
• Social and Cultural Environment.
• Economic Environment. Economic Systems.

Business Environment can be defined as sum or collection of all internal and external factors such as:

• Employees
• Customer needs
• Expectations
• Supply
• Demand
• Management
• Clients
• Suppliers
• Owners
• Activities by government
• Innovation in technology
• Social trends
• Market trends
• Economic changes, etc.

Factors influencing management:

• Changes in Executive Management.
• Transformations in Organizational Structure.
• Competition from Other Businesses.
• Social and Cultural Factors.
• Laws and Regulations.

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