11/08/2020 - Business

Business Environment is dynamic. Dynamic - Ever changing

Businesses operate in an environment which includes

1) actions of other businesses

2) the labour market

3) govt economic and social policies

4) consumer tastes and demand

5) the legal framework

6) political factors

7) social and demographic factors

8) changing technologies

These factors change over time. Some factors might change slowly e.g changes in
income, ageing population.

Other factors might have a quick change, new competiton, new law or s
competitor reducing its prices in a competitive market

Note: Businesses have to monitor their environment and be ready, able and
willing to adapt to the conditions.

Carrying on in the same way is an option that often leads to failiure

What does a business need to succeed?

· A business needs to be effective in the following areas:

1) Enterprise

risk taker, factor of productions, and unique ideas.

The ability to see possible opportunities in the market for transforming inputs to
outputs and gaining a reward - which takes into account the risks & choices
involved

2) Organisation

the ability to choose the appropriate resources and combine them together
profitably to produce products at a price which consumers are willing to pay

3) Financial monitoring

keeping track of the money flows so that decisions can be made knowing the
actual opportunity cost

4) Human resource management

important so that the right number of appropriately skilled and trained people are
hired

5) Marketing

to ensure that products meet the customer needs in terms of design, price,
availability & value

6) Objectives;- AIMS/targets of a business

important to set these so that appropriate structure and strategy can be used

7) Co-ordination:- Developing cohesion between all departments so that the

overall objectives are achieved.

This also prevents duplication of jobs

Peter Stimpson

A level Business