Corporate Culture and the Environment-part 1

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Corporate Culture and the Environment-part 1 Chapter 3 Corporate Culture and the Environment-part 1

The Organizational Environment The elements of the world constantly change. The external organizational environment includes all outside elements that affect the organization. Internal Environment-Elements within the organization boundaries.

The External Environment External Environment includes (i)general environment (ii) task environment General Environment-Outer layer that indirectly affects organization. It includes five dimensions. Task Environment-Sectors that conduct transactions with the organization and directly influence its basic operations and performance.

3.1 The General, Task, and Internal Environments Copyright ©2012 by South-Western, a division of Cengage Learning. All rights reserved.

General Environment Five Dimensions: (i) International dimension (ii) Technological dimension (iii) Socio-cultural dimension (iv) Economic dimension (v) Legal-political dimension (vi) Natural

International dimension It represents events originating in foreign countries as well as opportunities for companies in other countries. -New competitors, customers, suppliers -Changes in social, technological, and economic trends

Technological dimension It includes scientific and technological advances in society. Advances are impacting organizations and managers

Socio-cultural dimension Includes demographic characteristics, norms, customs and values of a population within which the organization operates.

Economic dimension It represents general economic health of the country in which the organization operates. Consumer purchasing power, Unemployment rate etc. affect business.

Legal-Political It includes government regulations at different levels, as well as political activities designed to influence company activities. Managers must recognize the power of pressure groups. Pressure groups work to influence companies to behave in a socially responsible way

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