Polytechnic University of the Philippines
College of Business
Sta. Mesa, Manila
Types of Environment
Espiritu, Jeric Aris R.
Frayco, Sarah Glenn C.
Galido, Jeasel Rhea R.
Hornachos, Jio Benson C.
VII. Types of Environment
a. Factors of Specific Environment
b. Factors of General Environment
Socio Cultural Conditions
Importance of the Organizational Environment
c. Global & Local Legislatures
d. Agency of Government & their functions
Environmental Laws of the Philippines
Organizational environment is defined as all elements that exist outside or inside the boundary of the organization and have the potential to offer all or part of the organization. External environment refers to the major factors or forces outside the organization that potentially affect an organizations performance. External environment is divided into two parts i.e. Mega environment or General Environment and specific or task environment. External environment can significantly influence the effectiveness of an organization to large extent.
TYPES OF ENVIRONMENT
A. SPECIFIC ENVIROMENT/TASK ENVIRONMENT- is directly relevant to achievement of an organization's goal because they have direct and immediate impact on decisions and actions of managers. The specific environment is unique and changes with conditions. It is composed of specific groups and organizations that affect firm. The important constituents of task environment are: CUSTOMERS- it is the customer who absorbs organizational outputs. They represent potential uncertainty to an organization, their taste can change, they can become dissatisfied with organization's product or service. Therefore various organizations are making efforts to improve the quality of their products and services, stay close with the customers, listen to the customers about their needs and wants. COMPETITORS- refer to those organizations that either offer or have a potential to offer rival products or services. It means that not only the existing rivals are threat to the success of organization but the potential new comers could be disastrous also. Organizations cannot afford to ignore is competitors. Managers must be prepared to respond to competitors policies regarding pricing new products, services offered and other incentives it is giving to customers. SUPPLIERS- Organizations need different resources such as raw materials, goods, services etc. to conduct their operations. Therefore they purchase these resources from various individuals and organizations known as suppliers. (such as banks, insurance companies, pension funds etc) and labor inputs (such as labor unions, universities, local labor markets etc) It is the responsibility of each manager to ensure the steady flow of needed inputs at the lowers price available in order to maintain the effectiveness of an organization. e.g financial institutions are provider of money ,colleges are suppliers of human resources/ Managers need to have steady and reliable flow of input to meet the goals. PRESSURE GROUPS- Managers must recognize the special interest groups that attempt to influence organization. Such groups have the potential to influence the success of organization therefore managers have to be careful in their decisions and actions. The power of pressure groups changes with the change in social and political attitudes. Therefore organizations have to continuously monitor the major shifts in the society.
B. GENERAL ENVIRONMENT/ MEGA ENVIRONMENT- broad external conditions that may affect the organization. It is everything outside an organization which has an indirect impact on management decisions.
ECONOMIC CONDITIONS- it includes the impact of economic factors like interest...
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