Analyzing External Business Environmental Factors

The provided report assesses the impact of external business environmental factors on Rolls-Royce Motor Car Limited. It examines the influence of globalization, guarded globalisation in policies and decision making, and recommends future improvements for the company to achieve its organisational goal successfully.

Contemporary Developments
in Business and Management

Table of Contents
INTRODUCTION...........................................................................................................................3
TASK 1............................................................................................................................................3
Overview of primary external influences to the organisation and its importance......................3
TASK 2............................................................................................................................................7
I) Globalisation influencing policies and decision making in an industry sector.......................7
ii) Evaluate the effectiveness of the organization’s response.....................................................8
iii) Areas of improvements in Globalisation.............................................................................11
CONCLUSION..............................................................................................................................13
REFERENCES..............................................................................................................................14

INTRODUCTION
In business and management there are various developments can be seen which can
influence the organisation. External business environmental factors can affect the business of a
company. In this assignment chosen organisation is Rolls-Royce Motor car Limited. It is a
British luxury auto-mobile maker which is established in 1998. The aim of this report is to assess
the external business environmental factors on the organisation and evaluate the organisation's
position and responses. This report cover the following topics like- primary external influence in
the organisation and its importance, how globalization & guarded globalization can influences
policies and decision making and areas of improvement in the response of the company. Apart
from this it also discuss about effectiveness of these factors as response to the organisation.
TASK 1
Overview of primary external influences to the organisation and its importance
`An organisation can be influences by the external factors which can affect the
performance of the company. It is important to the Rolls-Royce Motor car Limited to determine
its emergence. A company have to perform various activities on day to day basis on effective
manner. It can control its internal activities in the business but it is very difficult to control and
manage the external business environment factors. These factors can be changed over a period of
time on the basis on changes in technology, taste, habit and preference. It can hamper the overall
performance of the company and it can affect its business and growth (Ehnert and Harry, 2012).
These factors are operated outside the organisation and have a indirect impact on the business of
Rolls-Royce Motor car Limited. External factors include micro factors and macro factors. Micro
factors are consists of following factors which are such as follows:
Suppliers:
Suppliers are those who provides the inputs like raw material and other components to
the company. In context to Rolls-Royce Motor car Limited, suppliers can affect business
environment of the organisation by increasing the prices of raw material which are used in car
manufacturing. Shortage of input components and material can also influence the external
environment of the company and it can hamper the production capacity of the organisation. If
production will decrease then profitability will also reduce. So it important for the Rolls-Royce

Motor car Limited to effectively maintain its suppliers so that it can not hamper the performance
of it.
Customers:
Customers can influence the external environment of the organisation. Success of the
company is depend on the consumers demand, taste, habit and preference. In context to Rolls-
Royce Motor car Limited, if it is not able to produce its products according to expectations of
consumers then it can not sell its cars in the market. It can reduces the sales as well as the profits
of the organisation. So it is important for the company to satisfy the wants and needs of persons
so it does not much affected from the external business environment.
Competitors:
Competitors can influence the external environment of the organisation. For an
organisation it it necessary to satisfy the needs and wants of its customers (Eskerod and
Huemann, 2013). In context to Rolls-Royce Motor car Limited, it is important to introduce
something unique to satisfy the consumers. Bring innovation which is not easily copied by the
competitors so that company can capture big market share and earn above average profit. It is
important for the company to beat its competitors so that it an make it extra ordinary reputation
in the market.
Market intermediaries:
Market intermediaries are those who help the company to provide its goods and services
to the consumers. In context to Rolls-Royce Motor car Limited, it can distributes its
manufactured products to the final customers with the help of market intermediaries. It includes-
marketing service agencies and middlemen. It helps the organisation to increase its market
reach. It is important for the company to take help these market intermediaries so that it can
increase its market share and profitability.
Shareholders:
Shareholders can influence the external environment of the organisation because they are
owners of the company. In context to Rolls-Royce Motor car Limited, if shareholders does not
want to purchase the shares of the company then it does not able to generates money from the
public. If it has not sufficient funds to invest then it does not able to expand its business and earn
more profits. It is important for the company to analyse all the external environment factors so

that it can survive for a long time in the market and achieve its goals and objectives that it profit
maximization.
Macro factors:
Macro factors also influence the external environment of the company. It includes-
political, economic, social, technological, environmental and legal factors which are discuss
below:
(Source: Forces in the macro- environment, 2018)
Political forces:
Political factors can affect the performance of the organisation. In context to Rolls-Royce
Motor car Limited, external environment of the company can be influence by the changes of
government policies. Government can impose the new taxes or duty which can affect the
company because it can reduce the profitability (Gustafson, P., 2012) It is important for the
organisation to properly analyse the political factors so that its performance does not hamper.
Economic factors:

Economic factors can analyse the economic performance of the company. It includes-
interest rate, exchange rate, inflation and economic growth. In context to Rolls-Royce Motor car
Limited, these factors can influence the external environment of the organisation. If inflation rate
is increasing of the economy then it can affect the prices of company's product and service. It can
affect the purchasing power of consumers and influence the demand and supply in the economy.
So it is important for the Rolls-Royce Motor car Limited to effectively analyse the economic
factors so that it does not much influence by these factors.
Social factors:
Social factors are also known as socio-cultural factors which includes the shared beliefs
and attitudes of the persons in the country. It includes- age, population growth and health of the
people in the society. In context to Rolls-Royce Motor car Limited, it can make its products as
per the standard of living of people and age so that it can sell its cars easily in the market. It is
important for the company to satisfy the desire of persons who lives in a society. It can help the
organisation to make higher profit and increase its market share.
Technological factors:
Technological factors can influence the external environment of the company. Innovation
in technology can affect the performance of the organisation. In context to Rolls-Royce Motor
car Limited, If technology of car manufacturing has been changed and it does not have this new
technology. It can hamper the production process of it because old technology consume more
time and quality is not good. If they bring new innovation in car manufacturing process then
productivity and quality can be improve. It is important for the Rolls-Royce Motor car Limited
because it can increase the demand of its products which can help the organisation to increase its
profits.
Legal factors:
Legal factors can influence the external environment of the company. Government of a
country has power to the change the legal matters in the country. In context to Rolls-Royce
Motor car Limited, it can affect the business of it. If government has announce that it is
mandatory for the organisations to contribute 2% out of its profits towards corporate social
responsibility then it can minimise the profits of the organisation (Hall and Ko, 2014)So it is
important for the company to analyse the legal factors properly so that it does not affect from the
changes of external environment.

Environment factors:
Environment factors can influence the external environment of the organisation. It
includes, geographical location, weather and climate of a country. In context to Rolls-Royce
Motor car Limited, it is essential for it to manufacture the car according to geographical location
and climate of the country. It helps the company to increase its sales and capture the more market
share and increase the profits of it. It is important for the organisation to properly analyse the
environmental factors so that they can survive for a long time in the market (Kemp, 2013.)
TASK 2
I) Globalisation influencing policies and decision making in an industry sector
Globalisation is the process integrated with networks around national, regional,
economies and cultures. Their primary focus is on economic side like trades, capital flows,
foreign direct investments. Economically it is based on goods and services, technologies. Rolls-
Royce motor car Limited has started their integration with social and cultural aspects. Guarded
globalisation introducing own industries in foreign. Foreign competition with nationally and
regionally are risky in an organisation. The impact of globalisation placed for marketing and
production. Rolls-Royce motor car Limited is working globally in market place barriers in
selling rather than home country. This decline changes is easier for a company to enter in foreign
markets. Company distributes its products with an advantage of different prices and in different
nations. Graded globalisation faces opportunities in reported cases of loss on culture,
unemployment challenges. Due to international changes takes place makes effect on political and
economic. It establishes same kind of changes in various organisation. It enables the company
Rolls-Royce motor car Limited faces mass production customised and added value products in
satisfying customers wants. Corporations is working through modern era investing money in
branding and its establishment by advertising and sponsoring resulting to market. Influencing
policies and decision making impact on globalisation.
 Globalisation drives public policy by making development which is acceptable to
recognise the role in chain relation. It is made to influence thinking process of stake
holders. Policy process in a way of learning and diffusion. Profound decision making of
mangers responsible for interrelated decisions.

 Evaluating policies are examined in a relation to resolve problems. Rolls-Royce motor
car Limited uses policies in solving such problems and making decisions in a way to
examine multiple intelligences. It is an important for policy development to solve and to
address issues associated with decisions.
 Policy influences Rolls-Royce motor car Limited by reviewing, analysing and critiquing
in learning. The capability of managers is to compose global groups in motor car
company. They involve social consideration in context with the policies. Policy makers
are engaged in processes in researching information and evaluating their policy
accountability by making concrete decision.
 Rolls-Royce motor car Limited company policy maker in regarding with globalisation
lead with program responsibility and implementing feasibility. It is consultative process
that enables favourable decisions in policies. Globally their impact came on managers of
Rolls-Royce motor car Limited to make efficient decision for company.
 It embracing in setting international policies standards. Development in policies,
individual state consider implications on domestic context evaluate organisation
performance. Decision process evaluation and modification completely effect on
competitive area and decisions on international community.
ii) Evaluate the effectiveness of the organization’s response.
Evaluation is a systematic determination of merit and worth. The evaluation in Rolls-
Royce motor car Limited classified in product, program, person, policy, portfolio. This leads
good from bad evaluation allows in distinguishing between individuals and organization. It tends
to make a supporting decisions in purchasing, developing programs within an organisation.
Globalisation challenges is reforming themselves by innovative management methods. The
evaluation is done by interests of public. The effective direction is done on the basis of managing
tradition and change (Parton, 2014). For global management skills and competencies handling
effective communication, teams, diversity, change, ethics in across organisation. Rolls-Royce
motor car Limited recognises similarities in cultural frames. Manage: Evaluation is a systematic process for managing performance of an individual
within an organisation. Rolls-Royce motor car Limited focuses constantly in organisation
to improve perform ability. It is a tool first to identify globally then implement it in
various ways. Managing activity is an essential for effective organisation for achievement

and better results. The way of effective evaluation in terms of assessing, auditing,
researching and reviewing fluently by managing these terms. It manages ethical
guidelines which guided and evaluated. Many of the organisations addressing issues of
quality and ethics together. Managing required in documents and processes by which it
evaluate activities, monitoring compliances during evaluation. Different organisation
manages different forms of documents, labels that describes in purpose of evaluating.
Managing activity is also done in the basis of teams of reference, statement of work,
request of proposal, invitation to tender. Define: In this, it is important to define an organisation effectiveness for developing
results. Globally the institutions has multilateral organisation achieving capabilities in
place to support an achievement of results. Rolls-Royce motor car Limited focus on
defining systems, behaviour and practices. Global financial and economic crises is there
to find problems in regarding with large prevented information. The unintended results
are open ended questions by encouraging unexpected results. Rolls-Royce motor car
Limited implemented their program by identifying possible outcomes, especially negative
impacts occur in this company. This vehicle company tends to investigate and tracked.
Globalisation is to make sure in intending results or outcomes. Experienced people can
easily identified program critics those are especially useful (Randolph, 2013).The
organisation has to evaluate many of suspects in order to evaluate them in context with
other projects and programmes. Programme theory explains an intervention in an
organisation where Rolls-Royce motor car Limited produces actual impacts which
contributes chain of results. Their conceptual frameworks in programmes is a useful way
of bringing together with clarification in evaluation. Frame: In this, it is based in identifying intended users globally. They considered an
organisation in form of deciding purposes in various framing methods. The specific
people, position and organisation use in evaluating capacity globally. It is a frame in
determining what is good, better and best. Rolls-Royce motor car Limited are producing
overall judgement of performances globally. The frame work is provided by developing
evaluation system. Key evaluation categorise programs which are appropriate, effective
and efficient. This program framed in achieving organisational evaluation. The
effectiveness is concerned with short, medium and long term outcomes.

 Describe: It is an evaluation important to develop indicators, implementing measures and
results. Globally the task focuses to collect retrieve data in results and other factors.
Describing is based on first to gather information from participants and analysing it.
Rolls-Royce motor car Limited company of vehicles evaluate by quantitative and
qualitative data to improve in an organisation. For evaluating part the pattern which are
summarise in analytical form. Data visualisation represents data in graphically order top
identify trends and patterns that is unclear and difficult in concern. Understand Causes: It refers to check results which are consistent. Globally this
intervention has not been implemented. The causes is to be understood by developing
community infrastructure and evaluating to raise it confidently. For understanding causes,
it includes attention for evaluating causes occur. Rolls-Royce motor car Limited
understanding causes to check the observed results with relationships in between
intervention and observed impacts. Their are some process and activities to evaluate
outcomes without an investigation. In understanding cause, it is an alternative
explanation in contribution of an evaluating project actions in particular change in policy
environment. Synthesise: For evaluating judgements the synthesises data systematically the range of
options is used for valuing it. It simply involves in generalise finding places or groups
globally. Rolls-Royce motor car Limited assume that program is to succeed in future and
support organisation by evaluating. Extrapolate finding involves level of places, groups
of people. The evaluation takes place for future likely to use effectively to generalised
better results. Globalisation is takes place internationally with an interest by scaling clear
about situations.
 Report and Support use: In this effective evaluation in an organisation it begins by first
gathering and analysing data. Rolls-Royce motor car Limited meet intended users in
evaluating integral part by having communication in organisation to identify what to do.
Globalisation demonstrate impact in programme or project. The beneficial terms with
communities is implemented by a company ensuring clarity with stakeholders groups.
They are ensuring accessibility in evaluating approach by addressing challenges with
casual inference. It is the last phase in effective evaluation in developing
recommendations on the basis of finding. Organisation response matter in processing that

involves stakeholders in developing and reviewing them to contribute use of that finding.
Evaluation committee should consulted will support and probably important to ensure
finding that are disseminated and used.
iii) Areas of improvements in Globalisation
For a company is it important to make changes in its business according to the need and
wants of customers and environment. Environment is changes over a period of time and no one
can predict the future that what is going to be happen. So it is necessary for the organisation to
assume the expectations of customers in near future. For a company like Rolls-Royce Motor car
Limited who is doing its business around the world means at a global level. To perform in a
global market it is important to do things according to expectations of all consumers around the
world. It can not do the things as per the desire of people related to a particular country. In
globalisation, organisation have to satisfy the all persons and for that Rolls-Royce Motor car
Limited can make changes its products according to the needs of persons country to country. To
compete in a global market it should improve in its technology so that it increase its market share
(Lambert. et. al., 2015). There are various areas where it can improve itself. These areas are such
as follows:
Technology:
Today almost all persons depend on the technology because it makes our life more
convenient, comfortable and easy. Technology is important element of the organisational
success. Rolls-Royce Motor car Limited can use robots in its manufacturing and production
plant. It can make the work easy and on time with better quality. Chances of errors can be
minimise by using the robots and organisation does not spend excess money in the salaries and
wages. It can use this money in future improvement or investment. It makes the process of
production automatic. If company have better technology then it can create monopoly in the
market and its can increase the profits of Rolls-Royce Motor car Limited. It helps the
organisation to towards sustainable success and growth.
Management:
Effective management is essential for a company who is doing its business in many
countries. In context to Rolls-Royce Motor car Limited, there should be proper be proper
management between all departments of the company. There are various departments in a
organisation like- purchase, sales, marketing, finance, research and development etc. There

should be proper coordination and communication between all departments so that organisation
will be able to manage effectively it all departments. It shows the effective and efficient
management of the company.
Customer Service:
In this, for improving customer relations by having direct interaction with company.
Services team is to define in obtaining or facing with skill and quality of a support team they
receive. Improving capability is considered with opportunities of customer needs and wants. The
relationship will stagnate customer service by improving efficiency. Rolls-Royce motor car
Limited provided their customers vehicle services according to their capability.
Collaborate Smartly :
Smartly collaborating with an organisation helps to deal with each person smartly by
providing right directions. Leaders are forward looking to questions in coordinating and
collaborating with others globally. People working in an organisation wants to get everyone
convinced in changing the difference came in their mind. It is based on the joint activity in an
organisation that helps to work towards goals, completing task. Working together in an effective
way helps to improve performance in organisation (van der Aalst, 2012). Rolls-Royce motor car
Limited employees collaborating with their team, members smartly in accomplishing targets and
improving their performances.
Refine for success:
Due to globalisation, changes occur in an organisation in way of complete adoption, good
sign that shows in continuous improvement within an organisation. For improving advantage of
facing new opportunities in improving organisational that often stage globally. They improve
their original idea in form for better changes which helps in obtaining objectives in an
organisation. Rolls-Royce motor car Limited successfully deal with organisation in continuous
improvement for targeting achievements. An organisation main motive is to achieve success by
using refining process.
Decision Making:
it is a daily activity in business organisation to make an effective and successful decisions
for making profits to an organisation. Effective decisions are made in cooperating manner. For
making decisions regarding many of the tools and techniques are involved. Globalisation is
concerned with improving decisions among team effectively. Their purpose is to identify and last

to evaluate with improving skills and knowledge. Rolls-Royce motor car Limited employees are
working in a team with accepting consequences and solving it with full efficiency. An
organisation avoid conflicts and consequences occur (Massini and Miozzo, 2012). Finest
decision made by company and organisation helps in achieving desired objectives.
CONCLUSION
As from the above report, it has been concluded that it is necessary for the organisation to
analyse the contemporary developments in business and management so that it does not
influence from the business environmental factors. In this report, Rolls-Royce Motor car Limited
analyse and evaluate the impact of external business environmental factors on the organisation.
In this assignment influence of external environment is discussed so that company can find out
appropriate the methods to take care from them. Apart from that it also mention about influence
of globalization and guarded globalisation in policies and decision making. Recommendation for
future improvements is also discussed so that company can improve itself and achieve its
organisational goal successfully.

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quiz.html
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