QTH -Unit 3: Managing Business Environment

Omnipotent View of Management

(Managerial Constraints / n.) The view that managers are directly responsible for an organization’s success or failure.

Symbolic View of Management

(Managerial Constraints / n.) The view that much of an organization’s success or failure is due to external forces outside managers’ control.

Managerial Constraints

(Managerial Constraints / n.) The boundaries placed on managerial discretion, where external constraints stem from the organization's environment and internal constraints stem from the organization's culture.

External Environment

(External Environment / n.) Those factors and forces outside the organization that affect its performance.

Business Environment

(External Environment / n.) The comprehensive environment comprising both the general environment and specific environment surrounding an organization.

General Environment

(External Environment / n.) Broad external conditions and forces that may affect the organization, including economic, demographic, political/legal, technological, sociocultural, and global components.

Specific Environment

(External Environment / n.) External forces that have a direct impact on managerial decisions and actions and are directly relevant to the achievement of organizational goals.

Economic Component

(General Environment / n.) Factors such as interest rates, inflation, changes in disposable income, stock market fluctuations, and business cycle stages that impact organizational performance.

Demographic Component

(General Environment / n.) Trends in population characteristics such as age, race, gender, education level, geographic location, income, and family composition.

Political/Legal Component

(General Environment / n.) Federal, state, and local laws, global laws, as well as a country's political conditions and stability that constrain or enable business operations.

Technological Component

(General Environment / n.) Scientific or industrial innovations that create new ways of transforming inputs into outputs.

Sociocultural Component

(General Environment / n.) Societal and cultural factors such as values, attitudes, trends, traditions, lifestyles, beliefs, tastes, and patterns of behavior.

Global Component

(General Environment / n.) Issues and forces associated with globalization and a world economy that impact organizational operations.

Demographic Environment

(Demography / n.) The study of population size and characteristics that significantly affect what an organization can achieve in politics, economics, and culture.

Baby Boomers

(Demographic Cohorts / n.) The demographic group born between 1946 and 1964, representing one of the largest and most influential age cohorts in history.

Gen Y (Millennials)

(Demographic Cohorts / n.) The demographic group born between 1978 and 1994, children of Baby Boomers, who make a major impact on technology adoption and workplace dynamics.

Post-Millennials (iGeneration)

(Demographic Cohorts / n.) The youngest identified age group (teens and middle-schoolers) whose lives and habits have been customized from birth by advances in digital technology.

Environmental Uncertainty

(Environmental Uncertainty / n.) The degree of change and complexity in an organization’s environment.

Degree of Change

(Environmental Uncertainty / n.) The dimension of environmental uncertainty describing whether an organization's external environment is stable or dynamic.

Stable Environment

(Environmental Uncertainty / n.) An environment characterized by minimal, predictable, and slow changes in external components.

Dynamic Environment

(Environmental Uncertainty / n.) An environment characterized by frequent, rapid, and unpredictable changes in external components.

Organizational Complexity

(Environmental Uncertainty / n.) The number of components in an organization’s environment and the extent of the organization’s knowledge about those components.

Simple Environment

(Environmental Uncertainty / n.)An environment containing few external components that are somewhat similar and require minimal sophisticated knowledge.

Complex Environment

(Environmental Uncertainty / n.) An environment containing many external components that are not similar to one another and require high levels of sophisticated knowledge.

Environmental Uncertainty Matrix

(Environmental Uncertainty / n.) A 2x2 framework evaluating uncertainty based on degree of change (stable vs. dynamic) and degree of complexity (simple vs. complex).

Stakeholders

(Stakeholder Management / n.) Any constituencies in an organization's environment that are affected by or can affect an organization’s decisions and actions.

Internal Stakeholders

(Stakeholder Management / n.) Constituent groups inside the organization, such as employees and shareholders, affected by managerial choices.

External Stakeholders

(Stakeholder Management / n.) Constituent groups outside the organization, such as customers, suppliers, competitors, governments, media, trade associations, unions, and public pressure groups.

Stakeholder Relationships Management

(Stakeholder Management / n.) The strategic effort to build positive relationships with key constituencies, leading to improved predictability of changes, higher innovation, increased trust, and greater organizational flexibility.