Macroenviroment Microenvironment 1. Internal environment 2. External environment

1.Internal environment => all functions within a firm 2.External environment => all forces and events outside organization affect on its activities  Macro environment: not immediately affect firm’s activities  Micro environment: directly affect the firm’s activities

 Factors and forces outside the organization that affect the organization’s performance  There are 2 main components : › Specific Environment › General Environment

 Includes external forces that directly impact managers’ decision and actions and are directly relevant to the achievement of organization’s goals

 Customers  Suppliers  Competitors  Pressure Groups

 Includes broad factors affect not only one specific organization but they also affect other organizations involve with those environment, thus managers must take these environment into consideration when they do planning, organizing, leading, and controlling

 Economic Conditions  Political/Legal Conditions  Sociocultural Conditions  Demographic Conditions  Technological Conditions  Global Conditions

 Economic Conditions: GDP growth rate, interest rate, inflation rate, exchange rate, minimum wage rate, etc.  Political/Legal Conditions  Sociocultural Conditions  Demographic Conditions  Technological Conditions  Global Conditions

 Economic Conditions  Political/Legal Conditions: political stability, corruption, government policy, labor law, tax law, environment law, etc.  Sociocultural Conditions  Demographic Conditions  Technological Conditions  Global Conditions

 Economic Conditions  Political/Legal Conditions  Sociocultural Conditions: social value, life style, educational standard, language literacy, health concern, social problems, etc.  Demographic Conditions  Technological Conditions  Global Conditions

 Economic Conditions  Political/Legal Conditions  Sociocultural Conditions  Demographic Conditions: gender, age, educational level, geographic location, income, etc.  Technological Conditions  Global Conditions

 Economic Conditions  Political/Legal Conditions  Sociocultural Conditions  Demographic Conditions  Technological Conditions: telecommunication technology, alternative energy technology, technology development and transfer, etc.  Global Conditions

 Economic Conditions  Political/Legal Conditions  Sociocultural Conditions  Demographic Conditions  Technological Conditions  Global Conditions: WTO, IMF, international conflict, FTA, trading blocs, etc.

 Includes internal factors drive organization to its goals which consist of: 1. System 2. Internal stakeholders 3. Facility 4. Organizational culture

1. System: functions or departments within organization i.e. system of marketing, operation, human resources, accounting, finance, and information  Manager must concern: goal and plan of each system within org. thoroughly, resources are needed for each system, and how well each system coordinate to each other.

2. Internal stakeholders: shareholders, board of directors, employees  Manager must clearly understand: role, responsibility, and expectation of each stakeholder within organization [*Board of directors is a group of people elected by the owners of a business entity who have decision-making authority, voting authority, and specific responsibilities which in each case is separate and distinct from the authority and responsibilities of owners and managers of the business entity ] Source :

3. Facility: equipments, tools, building, plant, location  Manager need to provide proper facilities are needed for employees and also need to concern with the budget are provided by organization 4. Organizational culture

 The shared values, principles, traditions, and ways of doing things that influence the way organizational member act.  The specific collection of values and norms that are shared by people and groups in an organization and that control the way they interact with each other and with stakeholders outside the organization.* *Source:

 Symbols

 Stories It was first established in the King Chulalongkorn (Rama V) period and was established to be the higher education institution in the King Vajiravudh (Rama VI) period.

 Rites & Ceremonies WaiKru Ceremony & New Students Welcoming Activities

 Values Seniority system among students and staff.

 Beliefs Members in CU believe in virtues of the King Chulalongkorn (Rama V) and Thai royal families.

 Norms First year student uniform: Male: CU Necktie Female: White shoes & socks

1. Attention to detail : need to provide detailed data to support the decision making ? 2. Outcome orientation : focus on results (ends) or processes or methods (means) ? 3. People orientation : all decision making concerns effect on people in organization ? 4. Team orientation : work teams or individuals ? 5. Aggressiveness : competitive working environment or cooperative ? 6. Stability : focus on maintaining the current org. status ? 7. Innovation and risk taking : encourage creative decision and adapt to change ?

Strong CulturesWeak Cultures Values widely shared Values limited to a few people— usually top management Culture conveys consistent messages about what’s important Culture sends contradictory messages about what’s important Most employees can tell stories about company history/heroes Employees have little knowledge of company history or heroes Employees strongly identify with culture Employees have little identification with culture Strong connection between shared values and behaviors Little connection between shared values and behaviors

 Employee are more loyal.  High organizational performance. (If values are clear and widely accepted, employees know what they’re supposed to do & what’s expected of them  they can act quickly to take care of problems.)

 Strong culture might prevent employees from trying new approaches, especially when conditions are changing rapidly.

 Planning › The degree of risk plan should contain › Whether plans should be developed by individuals or teams

 Organizing › How much autonomy should be designed into employees’ jobs › Whether tasks should be done by individuals or in teams › The degree to which department managers interact with each other

 Leading › The degree to which managers are concerned with increasing employee job satisfaction › What leadership styles are appropriate

 Controlling › Whether to impose external controls or to allow employees to control their own actions › What criteria should be emphasized in employee performance evaluations

Source: Based on the Caux Round Table’s Principles for Business. The principles are printed in Business Ethics magazine, 52 S. 10 th St. #110, Minneapolis, MN