1. BUSINESS ENVIRONMENT AND LAWBY
E.KUSUMA

2. BUSINESS ENVIRONMENT BUSINESS DEFINITION:
Business may be defined as “an activity involving regular production or purchase of goods and services for sale, transfer and exchange with an object of earning profit”.
“Any activity of individual or group of people with the aim of earning money for satisfying their requirements by the Way of satisfying needs and wants of the customers is known as business.”

3. CHARACTERISTICS OF BUSINESS:
Deals in goods and services
Sale or exchange of goods and services
Regular exchange of goods and services
Requires investment
Aims at earning profit
Involves risk and uncertainty of income
Business skills for economic success

4. COMPONENTS OF ENVIRONMENT

5. Nature of Business Environment:
The various characteristics of business environment are:
Complex
Dynamic
Affect other firm's differently
Long and short term impact
Effect of external factors
Uncertainty
Interdependency

6. Business Environment –combination of both internal and external factors
Factors Affecting Business Environment:
Internal environmental factors for business:
Capital
Human resources
Objective
Management policies
Commitment of the employees
Image of the company
Internal work environment
Labour relationship management
Research and development
Promotional strategies

7. Business Environment –combination of both internal and external factors
Factors Affecting Business Environment:
Internal environmental factors for business:
Capital
Human resources
Objective
Management policies
Commitment of the employees
Image of the company
Internal work environment
Labour relationship management
Research and development
Promotional strategies

8. Political
Social
& cultural
Economic
INTERDEPENDENCY

9. Micro External environment Factors:
customers
Suppliers
Marketing intermediaries
Competitors
General public

10. Scope /Importance of Business Environment:
Identification of strength
Identification of weakness:
Identification of opportunities
Identification of threat:
Optimum use of resources:
Survival and growth

11. INDUSTRIAL POLICY Introduction:
Industrial policy is an important document, which lays a wide canvas and sets the tone for implementing promotional and regulatory roles of the government.
Objectives:
Achieving socialistic pattern of society
Achieving industrial development
Achieving economic growth
Reduce disparities in regional development
Developing heavy and capital goods industries
Provide opportunities for gainful employment
Expanding the public sector for achieving socialism
Alleviating poverty
Protecting and developing healthy small scale industries
Liberalization and globalization of economy

12. Industrial Policy, 1991 Objectives of 1991 Policy
Removing the regulatory system and other weaknesses.
Increasing the competitiveness of industries for the benefit of the common man.
Incentives for the industriali7ation of the backward area.
Enhanced support to the small-scale sector.
Ensure running of public sector undertakings (PSUs) on business lines and cut their losses.

13. Salient Features IP 1991: Industrial Licensing
Diminishing the role of public sector
Foreign direct investment
Policy relating to MRTP act
An exclusive small sector policy
Removal of compulsory convertibility clause

14. LPG POLICIES Reasons for implementing L P G :
Excess of consumption and expenditure over revenue resulting in heavy govt. borrowings.
Growing inefficiency on the use of resources.
Over protection to industries.
Mismanagement of the firm and the economy.
Increase in losses for public sector enterprises.

15. Components in liberalization
Reforms taken during Liberalization
Financial Sector
Industrial Sector
Trade Sector
Fiscal
Sector

16. Privatisation Modes of Privatization Initial public offer
Strategic Sale
Sales to foreigners
Management employee buy outs
Managerial Privatization