ABM 001: Organization and Management

Module #4 Student Activity Sheet

LESSON TITLE: Various Forces / Elements of the Firm’s 1.

Environment Materials:
SAS
Lesson Target/s:
At the end of this day, I should be able to: Reference:
pp. 53 - 57, Business Organization
1. Identify Components of the Environment and Management, Medina, R.
2. Define Business Environment
pp. 41- 49, Fundamentals of
Management, Rodriguez, R.,
Echanis, E.
1.

A. LESSON PREVIEW/REVIEW
Introduction
Let the student interact and have ideas about the following:

1. What makes Enchanted Kingdom very attractive for recreational

activities ?

2. Describe how activities are designed to entertain the visitors?

B. MAIN LESSON

Content and Skill-Building

Understanding the Nature of Organizational Environment

3. What makes it as a travel destination?
The Environment of a firm can be defined as the sum of all the elements and forces present in its
immediate and remote surroundings which have a potential impact on its ability to achieve its objectives.
This is composed of INTERNAL ENVIRONMENT , which is consist of conditions and forces
1

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4. Who are behind the operation?

 ABM 001: Organization and Management
Module #4 Student Activity Sheet

within the organization. EXTERNAL ENVIRONMENT, which is everything outside of an organization boundaries
that might affect it. Where it is also influenced accordingly with :

Internal Environment

This refers to factors existing within a marketing firm. They are also called as controllable factors, because the
company has control over these factors :

a) it can alter or modify factors as its personnel, physical facilities, organization and function means, such as
marketing mix, to suit the environment.

There are many internal factors that influence the marketing function, they are :

Top Management : The organizational structure, Board of Director, professionalization of

management..etc
Finance and Accounting: Accounting refers to measure of revenue and costs to help the marketing and
to know how well it is achieving its objectives.
Research and Development : Research and Development refers to designing the product safe and
attractive. They are technological capabilities, determine a company ability to
innovate and compete.
Manufacturing : It is responsible for producing the desired quality and quantity of products.
Purchasing : Purchasing refers to procurement of goods and services from some external agencies.

Company Image and Brand Equity : The image of the company refers in raising finance, forming joint
ventures or other alliances soliciting marketing intermediaries, entering purchase
or sales contract, launching new products and services

External Environment

External factors are beyond the control of a firm, its success depends to a large extent on its adaptability to the
environment.

The external marketing environment consists of :

a) Macro environment, and

b) Micro environment

a) Micro environment: The environmental factors that are in its proximity. The factors influence the company’s
non-capacity to produce and serve the market.The factors are :

1.Competitor – an organization that competes with other organizations for resources.

2.Customer – whoever pays money to acquire an organization’s products or services.

be classified as :

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 ABM 001: Organization and Management
Module #4 Student Activity Sheet

a.Ultimate customers: These customers may be individual and householders.

b.Industrial customers: These customers are organization which buy goods and services for
producing other goods and services for the purpose of other earning profits or
fulfilling other objectives.

c.Resellers: They are the intermediaries who purchase goods with a view to resell them at a profit.
They can be wholesalers, retailers, distributors, etc.

d.Government and other non-profit customers: These customers purchase goods and services to
those for whom they are produced, for their consumption in most of the cases.

e.International customers: These customers are individual and organizations of other countries
who buy goods and services either for consumption or for industrial use. Such
buyers may be consumers, producers, resellers, and governments.

3.Supplier – an organization that provides resources for other organizations.

4.Market Intermediaries – use for promoting, sellimmg, distributing the goods and services to the ultimate
consumers
5.Strategic partners – An organization working together with one or more other organization ina
joint or similar arrangement
6. Regulator – A unit that has the potential to control, legislate, or otherwise influence the
organization’s policies and practices.

Macro Environment:

Macro environment factors act external to the company and are quite uncontrollable. These factors do not affect
the marketing ability of the concern directly but indirectly the influence marketing decisions of the company.

These are the macro environmental factors that affect the company’s marketing decisions :

1.Economic – the overall health and vitality of the economic system in which the organization
operates.
2.Technological – The methods available for converting resources into product and services.
3.Socio-Cultural – The customs, mores, values, and demographic characteristics of the society in
which the organization functions.
4.Political –Legal - The government regulation of business and the relationship between business
and government.
5.International – The extent to which an organization is involved in or affected by business in other
countries.

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 ABM 001: Organization and Management
Module #4 Student Activity Sheet

Skill-building Activities

Let the students answer for collaboration into grouping

with the following guide questions:

Case:

“If you happen to be a pilot of

flight PR 456 bound to a destination,

How will you travel if the weather forecast issues a coming tropical
depression in 12 hours ahead of the flight departure.”

1. Create a checklist how will the Pilot manage to consider the safe travel of the aircraft with the passengers on
board towards its point of arrival.

Check for Understanding

Instruction: Encircle the letter of the best answer to each question.

1. Can be defined as the sum of all the elements and forces present in its immediate and remote
surroundings which have a potential impact on its ability to achieve its objectives.
a. Environment of a Firm c. Internal Environment
b. Business Firm d. External Environment
2. It consist of conditions and forces within the organization
a. External Environment c. General Environment
b. Internal Environment d. Task Environment
3. It is everything outside of an organizations’ boundaries that might affect it.
a. Internal Environment c. General Environment
b. External Environment d. Task Environment
4. It is the factor that influence the company’s non- capacity to produce and serve the market.
a. Macro Environment c. Internal Environment
b. Micro Environment d. Task Environment
5. It is use for promoting, selling and distributing the goods and services to the final consumer.
a. Suppliers c. Competitors
b. Market Intermediaries d. public

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 ABM 001: Organization and Management
Module #4 Student Activity Sheet

C. LESSON WRAP-UP
Summary/Frequently Asked Question

Self- Evaluation on Achieving the Learning Target

I can identify components of the environment. _________

I can define business environment ________

FAQs
1.What Kind Of External Factors Influence The Process Of Business Enterprises?
The external factors are by and large, beyond the control of a company. The external or environmental factors
such as the economic factors, socio-cultural factors, government and legal factors, demographic factors, geo-
physical factors, etc., influence the process of business enterprises.
2. What Do You Understand By Free Market Economy?

The free market economy is not planned, controlled or regulated by the government. The government satisfies
community or collective wants, but does not compete with private firms; nor does it tell the people where to
work or what to produce.
The completely free market economy, however, is an abstract system rather than a real one

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