Macro environment consists of external factors that affect a business and that are uncontrollable and influence business-making decisions. The macro environment consists of different factors that pose opportunities and threats to the company. There are six factors that macro environment consists of; demographic environment, economic environment, natural forces, technological forces, political forces and social & cultural forces. It’s crucial to identify, understand and analyze the factors so that the company can reach its optimum performance. It’s important for companies to study the macro environment so that they can divide the population into different target markets and plan which market segment to go into.
It is important to note that forecasters must consider a number of new information, including rapidly changing economic conditions and globalization, when creating business forecasts based on past sales. Globalization and economic slowdown has made businesses subject to a great deal of uncertainty. In this time of rapid change, economies worldwide change rapidly, new markets open up and old ones change, and demand for products is often uncertain. As such, businesses must be flexible and adaptable in the types of methods that they use... ... middle of paper ... ...forecasts. Given the high degree of uncertainty in today's marketplace, qualitative forecasting techniques like the Delphi technique may help Firstlogic to better-forecast future sales.
Outsourcing results in low-quality output. For a financial firm this would mean consumers are not receiving exceptional service as they would if business activity were at the host country or they are having problems with the service received. Low-quality output negatively impacts a firm as it could result in a loss of consumers. Consumers may find the firm to be untrustworthy or unreliable and may want to switch to different providers. Consumers could also spread a negative word of mouth about the firm,
Various threats and weaknesses threaten the performance of the company by presenting constraints on the company's management. High levels of competition, financial crises and threat of information loss are a threat to the company’s survival. Weaknesses within the company including the poor productivity of the energy sector and flexibility threat could impact negatively on the company. To reduce the impact of threats and weaknesses, the company could use the strengths and opportunities to mitigate them. The efficient management can also be used to prevent loss of data through implementing proper control measures
A SWOT analysis is a tool that identifies internal and external factors that may affect an organization. According to Parnell (2014), a SWOT analysis allows managers to investigate the strengths, weaknesses, opportunities, and threats that a company may face in their environment. Strengths and weaknesses are typically internal factors; while opportunities and threats are external factors. A company’s strengths are the things that set them apart and make them different or better than anyone else in their industry. The weaknesses are the things that affect them in a negative manner that keep the company from being competitive.
Through the frameworks and issues, we concluded that while current setup would cause some budgetary discrepancies because of the lack of loyalty between the divisional controllers to the corporate controller, changing the organization structure of Martex would cause a disparity between the division manager and the divisional controller thus resulting in an anxiety in their working environment which is too costly as compared to maintaining the current setup. I. Case Context Rendell Company is experiencing some difficulties in implementing its modern control techniques due to the irking relationship between the divisional controller and the corporate controller (Mr. Bevins) resulting in an added fat to the organization’s budgets. Now, with these problems, Mr. Bevins is interested with the organizational structure of Martex if this will be the solution of the current problem. II.
And given that time changes everything in that environment, a company must be sure to be constantly monitoring the changes, making adjustments of its own to make sure it keeps up with the changes in its business environment. Failure of the firm to do so will mean being less competitive and less productive, not giving it the maximum profit, hampering the firm's progress as a whole and in extreme cases bankruptcy.
F. The Marketing Environment The company operates in a complex marketing environment, consisting of uncontrollable forces to which the company must adapt. The environment produces both threats and opportunities. The company must carefully analyze its environment so that it can avoid the threats and take advantage of the opportunities. VI. LOOKING BACK: REVIEWING THE CONCEPTS The hard task of selecting an overall company strategy for long run survival and growth is called strategic planning.
This essay will define the Inside Out and Outside In of organisations. In particular, the different strategic theories and concepts will be looked at using examples of organisations to explain how the Inside Out and Outside In will explain the success of organisations. The external factors of an organisation could be emphasised when strategic thinking is taking place, looking at the bigger picture, including their competition and customers. The PESTEL analysis framework can be used to identify an organisation’s external macro-environment. Issues including political, economic, social, technological, environmental and legal environments may be the key drivers that affect organisations (Johnson G et al, 2011).
The transactions introduce some risks of financial loss due to the failure in achieving the expected financial or strategic objectives. The financial or strategic benefits may not be realized due to competitions, regulatory requirements or other factors. One business risk involves effectively integrating the transferred businesses. Also, restructuring or reorganization of the businesses after transactions have been closed can be risky too. In terms of operational risks, integrating operations, especially the differences in organizational culture, can be a problem and may require significant management resources.