Impact of External Environment on Modern Organizational Structure and Design

Individual essay

Table of Contents
INTRODUCTION...........................................................................................................................1
Thesis Statement.........................................................................................................................1
LITERATURE REVIEW................................................................................................................1
External Environment scanning..................................................................................................1
Political environment..................................................................................................................2
Economic environment...............................................................................................................3
Socio-cultural environment.........................................................................................................4
Technological environment.........................................................................................................5
Legal environment......................................................................................................................5
CONCLUSION................................................................................................................................6
REFERENCES................................................................................................................................8

INTRODUCTION
Modern organisation is different from traditional businesses that relies on the
technologies and are boundary-less Aldehayyat, (2015). Modern business is dynamic that can be
described by the change that makes the industries spend on R&D to survive in the market. This
kind of organisations are boundary-less and can be operate through technologies. Business
environment is consisting of external condition and forces that have potential influence the
organisation. Generally, it is divided in two major parts i.e. External or macro environment and
internal or micro environment. Change in environment have impact on the modern organisation
structure and design that will be analysed in this essay with suitable examples. The study aims to
do external environment scanning for that purpose PESTLE analysis will be done. The external
analysis is done by contrasting various sectors such as; Retail and Banking.
Thesis Statement
The external environment is the surrounding that is of changing nature in which the
business operates. How these changes within external environment affects the performance of
the business organisation?
LITERATURE REVIEW
External Environment scanning
External environment scanning is defined by Bahmani, Farhadpoor & Hamidi, (2017) as
the process that systematically analyse the external environment in order to identify the sources
that has impact on businesses. The scanning identifies the changes from six various
environmental context including; political, socio-cultural, demographic, legal, economic,
organisational competitive and technological.
Borges & Janissek-Muniz, (2018) state that, at the global level any specific change in
business environment can affect the management function and organisational design.
Organisational design refers to the structure of any company. It is essential to develop
organisational design to identifies dysfunctional aspects of work flow, structure, process and
system and realigns them to convert it reality. Aldehayyat, (2015) mentioned that the business
environment of the industries moves through is made up of external and internal elements.
Internal environmental factor involves; management, cash flow, culture of the organisation,
physical assets and skill, knowledge and capabilities of the workforce.
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