Macro and Micro Environmental Factors of the Business: doc

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Table of Contents
INTRODUCTION...........................................................................................................................1
LO1..................................................................................................................................................1
Identifying the Macro and micro environmental factors of the business....................................1
LO2..................................................................................................................................................3
Examining the needs of the individual and organization in order to understand ethically and
sustainablly..................................................................................................................................3
CONCLUSION................................................................................................................................3
REFERENCES................................................................................................................................4

INTRODUCTION
Organization is a comprehensive unit which consists of multiple operations and activities
in order to achieve the main objectives of the firm. Business may be influenced by internal and
external factors of the enterprise. Although, there are many external factors which effect business
environment such as intermediaries, public, customers, competitors, social, technological,
political, economical and international. The study will be based on the PESTLE and SWOT
analysis that helps in determining external factors of the business. Also, the report will make a
clear understanding about individual and organizational aspects that derives ethical and
sustainable factors of enterprise.
LO1
Identifying the Macro and micro environmental factors of the business
Every business organisation is a part of the business environment within which all the
activities are operated (Auchter, 2015). A single unit cannot be able to perform all the functional
aspects as there are many factors that may effects business environment. This global business
can be classifies into two categories such as Micro and Macro environment.
Micro business Environment
Micro environment of the business can be defined as all the internal environment of the
business which may leads to the direct influence on the business activities. This includes
competitor, supplier, market, intermediaries and customer.
 Suppliers: Those individuals who supply inputs like raw material, which leads to the
great impact on the business environment. Supply shortage, delays or labour strikes may
affects the sales and result in less profitability.
 Customers: it is one of the main factor as all the businesses operations are generally
performed according to the needs of the customers. Customers are the buyers who
purchases the last manufactured commodity (Gupta, 2017). These buyers can be further
categorised as Consumer market, business market, reseller market, government market
and international market. Consumer market generally buys goods and services for
consumption process. Meanwhile, all the other markets buys the commodity for the
further selling which may be aimed at earning profits or social welfare (Macro and Micro
factors of Business Environment, 2018).
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 Market intermediaries: Market intermediaries can be considered as all those people
involved in marketing chain who are responsible for the promotion sales and distribution
of the goods to the final consumer. Such as wholesaler, retailer, marketing agencies,
advertising agencies and financial intermediaries (Banks, credit companies) etc.
 Competitors: success of the business is depended upon the abilities to satisfy the needs
and requirements of the consumer better than its competitors. Competitors are those
companies which encourages each other in doing better. Such factors which effects the
global business environment are entry and exit of competitors, Public: Companies global environment is generally surrounded by several types of public
such as general Public, media, Internal public, financial public etc. Actions of the public
may be responsible for the threats or opportunities for the business. For example,
financial public may affect company's ability to obtain funds while media and newspaper
may creates future opportunities for enterprise.
Macro Business environment
Those societal factors which indirectly affects the business environment and such factors
are more uncontrollable (Jamali and Karam, 2018). Such factors include Political, economical,
social, technological, environmental and legal factors.
 Political: These factors may be concerned with changing governmental policies which
may result in changing business procedures and ultimately it may effects the cost of
production.
 Economical: all those economic factors that have a bearing on the functioning of the
business unit. It directly impacts on the profitability of the business.
 Social: these factors of the business environment are basically concerned with the
changing tastes and preferences of the people. This directly impacts on the operation and
manufacturing of the goods and services in order to fulfil the needs of the customer.
 Technological: Such factors can be termed as the change in the technology of the firm
which result in the alteration in production methods and process of converting raw
material into goods (Kelley, Simmons and Doshi, 2016). It lowers the efficiency and
productivity of the employees.
 Legal: change in government policies leads to the rise in the taxation rates which impacts
on the prices of the goods and services.
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LO2
Examining the needs of the individual and organization in order to understand ethically and
sustainablly
Ethics and values are important within the business because it mainly influences the
strategic decisions and morals within organisation in order to promote sustainable development.
The act ions of the individual and organisation need to balance the economic growth and welfare
of society along with the environment al considerations.
Individual ethical and sustainable responsibility
It is the primary practices of the individual to provide the fair business practices that
derives the production of goods maintaining the ethical standards. Individual need to perform
operations which can not affect the health of the society and also use of the recycled product that
may benefits the company in cutting the cost of production (Ohotina, and et.al., 2018).
Therefore, it will benefit social as well as economical aspects of the organisation. Also,
individual need to possess the right skills for the development of the goods and services that may
helps in retaining the skilful workers for the long term which result in the sustainable
development of the firm
Organisational Ethical cultural and sustainable responsibility
Corporate social responsibility if to provide the effective goods and services to
customers. This ensures the development of effective products at affordable prices in which
integrity of the society and environment is largely protected. Often ethical and social
responsibilities of the business is to provide equal opportunities for every employee within an
organisation. This promotes the positive culture at workplace and hence satisfied employees
contributes towards the economic development of the firm (Trevino and Nelson, 2016).
Consumer behaviour and sustainability is strongly related terms as it is the responsibility of the
organisation to serve the society according to their demands. At the same time, profits are the
main objective of the firm so this derives the economic responsibility of the corporate.
CONCLUSION
From the above study, it can be concluded that Micro and macro factors impacts on the
long term objectives of the business. This study has provided various individual and
organisational responsibilities that helps in achieving sustainable, ethical and cultural
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environment of the business. It has been provided that global business environment gets affected
by Pestle analysis of the business.
REFERENCES
Books and Journals
Auchter, L., 2015. Supply chain responsibilities and the need for an integrative ethic
Management in Emerging Economies. International Journal of Business and Economic
Development (IJBED).3(1).
Gupta, R.K., 2018. Developing a framework for integration of flexibility in business excellence
models (Doctoral dissertation).
Jamali, D. and Karam, C., 2018. Corporate social responsibility in developing countries as an
emerging field of study. International Journal of Management Reviews.20(1). pp.32-61.
Kelley, J.G., Simmons, B.A. and Doshi, R., 2016, September. The power of ranking: the ease of
doing business indicator as a form of social pressure. In Annual Meeting of the American
Political Science Association Mini-Conference on Assessment Power in World Politics,
Philadelphia, PA (Vol. 2).
Ohotina, and et.al., 2018 "SOCIO-ECONOMIC SECURITY AS A DETERMINANT OF
REGIONAL DIFFERENCES IN THE INVESTMENT CLIMATE IN THE
REGION." Journal of Security & Sustainability Issues 7. no. 3 (2018).
Trevino, L.K. and Nelson, K.A., 2016. Managing business ethics: Straight talk about how to do
it right. John Wiley & Sons.
Online
Macro and Micro factors of Business Environment. 2018. [online]. Available
through:<http://shodhganga.inflibnet.ac.in/bitstream/10603/150520/13/13_chapter6.pdf>
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