BEN (Chap1)_A
Page 1: Keywords in Business Environment
Technology: Refers to tools and methods used in business operations.
Information: Crucial data that drives decisions in business strategies.
Chocolate: An example of a specific product in the consumer market.
Efficiency: The goal of maximizing output from given resources.
Diversity: Importance of variety in products, markets, and people.
Analysis: Systematic examination of components affecting business.
Socio-Culture: The impact of social and cultural factors on business.
Stability: The need for a stable environment for business to thrive.
Resource: Essential materials or inputs required for business functions.
Weakness: Internal shortcomings that can hinder business success.
Business Micro Environment: Immediate environment affecting business operations.
Multi-Faceted Economy: Complex economic structures influencing business activities.
Power: The control or influence over market forces and stakeholders.
Macro Environmental Forces: Larger external forces impacting the business landscape.
Supplier Terms: Conditions and agreements set by suppliers.
Politics: The influence of political decisions on business operations.
Growth: The expansion or increase in business scale or revenue.
Market: The arena in which goods and services are exchanged.
Profit Opportunity: Potential areas where profits can be generated.
Page 2: Business Environment in Nepal
Course Objectives:
Familiarize with environmental factors affecting businesses in Nepal.
Develop analysis skills regarding these environmental factors.
Understand the dynamics of how these factors influence business operations.
Page 3: Evaluation and Grading
Internal Evaluation (50%):
CIE I (Tests/Quizzes): 10%
CIE II (Module Test): 10%
CIE III (Mid Term): 20%
CIE IV (Case Study): 15%
CIE V (Project Work): 10%
CIE VI (End Term): 35%
External Evaluation (50%):
PU Board Exam: 100%
Attendance Requirement: 80% to sit for Mid and End Term.
Assignments: Various class tests, take-home assignments, and presentations.
Project Work: Group project with a mandatory final presentation.
Late Submission: Results in grade reduction.
Page 4: Reference Books and Resources
Books:
Pant, Prem R. (2020): "Fundamentals of Business Environment in Nepal."
Agrawal, Govind R. (2017): "Business Environment in Nepal."
Websites:
National Planning Commission: www.npc.gov.np
Department of Industries: www.doind.gov.np
Trade and Export Promotion Center: www.tepcnepal.org.np
Central Bureau of Statistics: www.cbs.gov.np
UN Development Programme: www.undp.org
Asian Development Bank: www.adb.org
World Bank: www.worldbank.org
Ministry of Finance: www.mof.gov.np
Page 5: Concept of Business Environment
Concept and Framework: Understanding the elements that shape business environments.
Components: Different key elements influencing business.
Environmental Scanning/Analysis: Processes and methods for identifying factors in business.
Use in Strategic Management: How analysis aids in strategic business decisions.
Page 6: Concept of Business
Definition: Activities tied to production or trading of goods/services.
Dynamic Nature: Constantly changing environments and influences.
External Influences: Social, economic, political, legal, cultural, and technological factors.
Key Stakeholders: Business, customers, government, competition, innovation, and suppliers.
Page 7: Business System Components
Inputs: Capital, raw materials, technology, labor, land.
Outputs: Goods, services, profits, employment, taxes.
Conversion Process: Transformation of inputs into outputs.
Inter-relationships: Interaction between different elements in the business environment.
Page 8: Definitions of Business Environment
Keith Davis: Aggregate of all conditions and influences surrounding a business.
Shawn Grinsley: Influences from both external and internal factors affecting a business’s life.
Overall Definition: The totality of external factors affecting a firm’s operations.
Page 9: Types of Business Environment
Classification:
Internal Environment
External Environment
Micro Environment: Close stakeholders like suppliers and consumers.
Macro Environment: Broader socio-economic factors influencing strategy.
Page 10: Further Classifications of Business Environment
Operating Environment: Directly affects operational performance.
Remote/General Environment: Political, legal, economic, socio-cultural, and technological influences.
Domestic Environment: Familiar uncontrollable forces within the home market.
International Environment: Interactions affecting business on a global scale.
Perception of Change: Influenced by managers’ backgrounds and positions.
Page 11: Components of Business Environment
General Environment Factors: Political-legal, technological, socio-cultural, economic forces.
Task Environment: Immediate factors like customers, competitors, economic forces.
Page 12: Internal Environment
Definition: Internal factors affecting the organization’s performance.
Significance: Provide strengths and weaknesses.
Components Include: Employees, structure, corporate culture, and shareholders.
Page 13: Internal Environment Components
Employees: Valuable source of information and competitiveness.
Structure: Framework of roles and authority within an organization.
Corporate Culture: Shared beliefs and values among organization members.
Shareholders: Owners of the business with vested interests.
Unions: Represent employee rights and negotiate working conditions.
Page 14: External Environment Dynamics
Complex Set of Forces: Constantly changing socio-economic and political influences.
Market Uncertainty: Nature of competition influences stability.
Classification: Divided into task and general environments.
Page 15: Task and General Environment Classification
Task (Micro) Environment: Forces immediately related to business goals.
General (Macro) Environment: Broader context impacting long-term strategies.
Page 16: Task Environment Components
Components that influence immediate business objectives:
Customers, suppliers, competitors.
Financial institutions, market intermediaries, associations, special interest groups, media, and government regulations.
Page 17: General Environment Components
Political Environment: Governance, stability, public opinion.
Legal Environment: Regulatory framework governing business conduct.
Economic Environment: Economic systems, market policies.
Socio-Cultural Environment: Society's norms, beliefs, implications on business.
Technological Environment: Innovations impacting business operations.
Global Environment: Effects of international relations on domestic businesses.
Page 18: Business Environment Components Overview
Classification: Internal vs. External Environments, including key factors affecting each.
Page 19: Environmental Analysis
Importance: Identifying internal and external elements impacting performance.
Purpose: Assess threats and opportunities for strategic formulation.
Page 20: Environmental Analysis Overview
Definition: Studying environmental factors influencing organization operations.
Goals: Identify strategic opportunities and threats.
Page 21: Steps in Environmental Analysis
Identifying Factors: Brainstorming on influential environmental forces.
Selecting Relevant Factors: Focus on most impactful elements for analysis.
Page 22: Developing Strategic Position
After identifying key factors, formulate strategies for future business success.
Page 23: Environmental Analysis Techniques
Methods: Environmental scanning, SWOT, PESTLE, and more.
Page 24: Environmental Scanning
Overview: Continuous information gathering to detect trends impacting business.
Sources: News outlets, journals, market reports, etc.
Page 25: Importance of Continuous Environmental Scanning
Survival: Key for adaptability and competitive advantage in business.
Page 26: Scanning Techniques
Internal vs. External Factors: Categorization of factors affecting business.
Page 27: Advanced Scanning Methods
Techniques used for comprehensive environmental evaluation, including extrapolation, intuitive reasoning, scenario building, and Delphi method.
Page 28: SWOT Analysis
Purpose: Identifying internal strengths and weaknesses and external opportunities and threats.
Page 29: Other Methods of Environmental Analysis
PESTEL Analysis: Broad external factors affecting the organization.
Monitoring: Tracking changes for strategic preparedness.
Page 30: Business Intelligence System
Utility: Transforms critical business information into actionable decisions.
Page 31: Forecasting and Risk Assessment
Forecasting: Reducing uncertainty regarding future business conditions, crucial for planning.
Benchmarking: Continuous performance comparison against industry best practices.
Page 32: Scenario Development
Use of Scenarios: Anticipating different future outcomes for strategic planning.
Page 33: Porter's Five Forces Model
Importance: Analyzes competitive environment and market dynamics.
Page 34: Components of Porter's Model
Assesses rivalry, threat of new entrants, power of suppliers, power of customers, and substitutes.
Page 35: Impact of Competition on Profitability
Increased rivalry leads to lower profits; market position depends on strategic responses to competitive forces.
Page 36: Environmental Analysis and Strategic Management
Acknowledges the importance of aligning business strategy with changing political and economic conditions.
Page 37: Emerging Business Realities
Discusses demographic changes, evolving corporate governance, and challenges faced in global business environments post-pandemic.
Page 38: Relationship in Strategic Management
Explores the interaction between organizations and their external environment, emphasizing strategic adaptability.
Page 39: Strategic Management Defined
Outlines definitions from various authors emphasizing planning, adaptability, and responsiveness to environmental changes.
Page 40: Steps in Strategic Management Process
Overview of strategic development from goal setting to implementation and monitoring.
Page 41: Challenges for Top Management
Management tasks focused on analyzing external forces to gain competitive advantage and mitigate risks.
Page 42: Enhancing Organizational Capability
Strategies for maximizing business efficiency through management of environmental pressures and organizational structure.
Page 43: Strategic Management Model
Outlines a structured approach to integrating external influences into strategic planning and operational execution.