Influence of External Environment on Organisation - Organisational Behaviour Assignment Help

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Assignment Task :
  1. Customers: It is the customer that absorbs organisational output. They represent the potential uncertainty to an organisation. They are the key driver for decisions made throughout the organisation. They influence the organisation by the way they react (thus, buy the goods and services from the organisation) to the organisations product thereby prompting the organisation to produce products to meet their demand if the organisation wants to be in business.

  2. Competitors: organisations cannot afford to ignore its competitors. Managers must be prepared to respond to competitor policies regarding pricing new product, service offered and other incentives it is giving to customers. Competitors influence the organisation by indirectly requesting management to explore the most efficient and effective way to produce their product and service at a cheaper cost using the right materials if they want to be in operation.

  3. Suppliers: Any party (individuals) that provide input for the business. Examples, financial institutions are providers of money, colleges are suppliers of human resource.

  4. Pressure groups: Managers must recognize the special interest groups that attempt to influence the organisations. These groups can impact either positively or negatively on the organisation. They can persuade managers of an organisation to produce a particular good or service to meet their demand. 

 

General environment are the broad external conditions that may affect the organisation. They include economic condition, socio-cultural condition, political or legal condition, demographic conditions, technological conditions and global conditions.

  1. Economic conditions: It include the impact of economic factors like interest rate, inflation, change in disposable income, taxes in the rules and regulations legislated by the government and the stage of general business cycle. These conditions can either impact positively or negatively on the organisation. For example, when the consumer’s disposable income increases, there is a likelihood that he will demand more for the organisation’s product or service but when disposable income decreases, he will buy less of the organisation’s product or service thereby having an influence on the organisation.

  2. Political or legal conditions: Federal state and local government influences what organisations cannot do. Political stability has an impact on the organisation. In order to have a stable development, the organisation should focus on the flexibility with the changes that is going to happen in the external environment of the organisation. Political or legal conditions can influence what the organisation can do and what the organisation cannot do thereby affecting the operations of the organisation.

  3. Socio-cultural conditions: Managers must adapt their practise to the changing expectation of the society and their lifestyle.

  4. Demographic conditions: Trends in the physical characteristics of population such as gender, age, level of education, income, and geographical location can influence the external environment of an organisation effectively. 

 

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