Essay on Micro and Macro Environmental Factors Affecting Business

This essay provides an in-depth analysis of micro and macro environmental factors that significantly impact modern businesses operating in a global context. It explores the differences between modern and traditional business operations, highlighting the influence of factors such as consumer behavior, competition, and technological advancements within the microenvironment. The essay also examines the macro environmental factors, including social values, culture, and technological changes, and their effects on business strategies and performance. Furthermore, the essay emphasizes the importance of Corporate Social Responsibility (CSR) for both organizations and individuals, discussing its role in ethical management, sustainable practices, and building a positive brand image. The conclusion summarizes the key findings, reinforcing the interconnectedness of environmental factors and the necessity of CSR in navigating the complexities of the modern business landscape.

MICRO AND MACRO
ENVIRONMENTAL
FACTORS

Table of Contents
INTRODUCTION...........................................................................................................................1
MAIN BODY...................................................................................................................................1
Internal an external factors that changed the nature of modern business in the global
environment............................................................................................................................1
Importance of CSR for organisations and individuals...........................................................2
CONCLUSION................................................................................................................................3
REFERENCES................................................................................................................................4

INTRODUCTION
Micro environment is the operating environment of the firm and macro environment is
remote environment of the firm. Micro environmental factors are interlinked with the company
than macro environmental factors. The individual essay aims to identify the micro and macro
environmental factors that can affect the modern businesses globally. Along with it, need of CSR
for individuals and organisation will also identify to manage responsibly and sustainably and
behave ethically.
MAIN BODY
Internal an external factors that changed the nature of modern business in the global environment
Modern businesses and traditional businesses are different in terms of operating (Crane,
Matten and Spence, 2019). As traditional organisations are operates within a specific market
boundaries and modern businesses are boundary-less. Modern business is more technology based
than traditional businesses. There are many factors and environments that affect the nature,
activity, operations and functions of the modern industry. Generally; the micro environment and
macro environment.
Micro environment are controllable and has direct and immediate bearing on the industry.
Main objective of any modern organisations is to satisfy the needs, desire and want of its target
consumers (Crowther and Seifi, 2018). They are the central part of any company who generate
revenue and drive sales. Currently consumers are open to choice and their switching cost is low
if they find their needs are not fulfilled by the company. Consumers affect the nature of modern
organisation that depends on their behaviour towards the organisation and their experience with
the services and product drive their loyalty and attachment. Customer's need, demand,
preferences, taste, priority, price sensitivity, etc. affect the nature, functions and operation of
modern organisation at global level.
Every organisation whether it is traditional or modern have competition at global or local
level and they are able to affect the nature and operation of the company (Grayson and Hodges,
2017). Modern organisation has to keep a constant check on their competitors, strategies and
ensure that the products are different and unique from the competitors. Technological
advancement, new research and development, pricing strategy and most importantly level of
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competition in the global market can affect the company and their profit as well as there is high
chance of losing the customers to many competitions in the market.
Macro environmental factors affect the modern company most on the global level and
they are not controllable and can influence decision making, performance, strategies of modern
organisations (Gutierrez, Boukrami and Lumsden, 2015). As modern businesses are boundary-
less and operates globally, the social values and culture of an international environment plays a
huge role in the functioning of a company. Social attitudes and value issues such as; social
customs, values and beliefs, changing lifestyle, changing demands according to the changing
trend, educational level can affect the behaviour of customers and thus it affects the nature of the
modern organisation.
Modern businesses relies on the technology and if a firm is unable to cope with
technological changes at global level cannot survive in the market. Globalisation and information
communication technology considered as a very important part of modern industries. New
technologies from manufacturing to offering products are affect the way of business operates in
the market. Thus, they should change their nature and functions with technological demand.
Importance of CSR for organisations and individuals
Corporate social responsibility is a concept of management whereby industries integrate
environmental and social concerns in their day to day operations and interaction with their
stakeholders (Corporate Social Responsibilities, 2019). It is the continuing commitment by
industries and their attached people to behave ethically and contribute to the social and economic
development. It concerns on idea that an organisation has social obligations above the making a
profit. The ability to make correct ethical choices depends on; Individual characteristics such as
the level of moral development and organisational characteristics such as corporate culture
(Prajogo, 2016). CSR is responsible to adherence to labour standards, environmental
management and protection. Ethics can be defined as a set of rules and policies that enable
individual and organization to understand what is right and what is wrong in the way of
operating and behaving in the society. It is being a need for individuals and organisation to
manage responsibly and sustainably and behave ethically to tackle and overcome the issues
related to culture, society, environment and economic. For individuals it is necessary as it
upholds social equity and other human rights and most importantly it enables companies where
they work to improve the quality of life of workforce and their families as well as society and
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local community at large. It is essential for the organisation to being responsible towards the
society, environment and towards the sustainable planet at large with being responsible morally
to the stakeholders.
CSR attracts the green and ethical investment that help them to maintain the brand image
in terms of protecting environment by encouraging recycling, waste management (Schaltegger
and Wagner, 2017). It allows organisations to attract ethically conscious consumers. To fulfil
long run self interest of the modern organisation, to establish a better public image, to avoid
misuse of resources, to minimize environmental damage and for economic and social welfare of
the community encourage the need of Corporate social responsibilities. Being socially
responsible enhance the performance of employees and provide them moral justification. It
allows the company to consider the rights of human, environment, community and society.
Overall CSR is beneficial for both organisation and for individuals in the society and in the
relation to socially responsible company. It creates employment and wealth for the society and
enhance competitive edge for the companies. A study stated that CSR programmes influence
70% of all customers purchasing decisions (Crowther and Seifi, 2018).
CONCLUSION
From the present individual essay it has been evaluated that modern businesses are relies
on global market and technologies. Thus, the nature of modern business affects by the micro and
macro environmental factors in the global market. It also has been concluded that for handling
the environmental, social, economic and cultural issues, organisation and individuals need to
adopt the CSR strategy.
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REFERENCES
Books and Journals
Crane, A., Matten, D. and Spence, L. eds., 2019. Corporate social responsibility: Readings and
cases in a global context. Routledge.
Crowther, D. and Seifi, S. eds., 2018. Redefining Corporate Social Responsibility. Emerald
Group Publishing.
Grayson, D. and Hodges, A., 2017. Corporate social opportunity!: Seven steps to make
corporate social responsibility work for your business. Routledge.
Gutierrez, A., Boukrami, E. and Lumsden, R., 2015. Technological, organisational and
environmental factors influencing managers’ decision to adopt cloud computing in the
UK. Journal of Enterprise Information Management. 28(6). pp.788-807.
Prajogo, D. I., 2016. The strategic fit between innovation strategies and business environment in
delivering business performance. International Journal of Production Economics. 171.
pp.241-249.
Schaltegger, S. and Wagner, M., 2017. Managing the business case for sustainability: The
integration of social, environmental and economic performance. Routledge.
Online
Corporate Social Responsibilities. 2019. [Online] Available
Through:<https://www.businessnewsdaily.com/4679-corporate-social-
responsibility.html>.
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