UNIT 01 : BUSINESS AND

ITS ENVIRONMENT
1.7 Analyses the influences of internal environmental forces on
businesses.
LEARNING OBJECTIVES

 Lists the internal environment forces that influence the business.

 Provides examples for the strengths and weaknesses related to each internal
force.
 Comparatively analyses how the strengths and weaknesses of the internal
environment influence the business activities.
 Explains the ways to make business successful by using its strengths and
actions that can be taken to avoid threats.
INTERNAL ENVIRONMNET
 The forces and conditions that influence and exist within an organization are
known as Internal environment.

Organization
structure
Owners Managers

Organization Resources
Employees culture
 The party, who contributed resources or invested funds in a business and endures
profits or losses is owners.

 The party who formulates business plans and makes decisions is the managers.

 The party, who is engaged on relevant works according to the plans and decisions
made by the top managers, is employees.

 The organization culture is the beliefs, values, attitudes, norms, habits,

behavioural patterns that are shared among everyone in the business and which
will be handed over to future generation.

 The way in which the functions, resources and authority of a business are
distributed to achieve the objective of a business easily is organization structure.

 Everything such as land, labour, capital, entrepreneurship, time, information and

knowledge that are used as inputs for producing goods and services are resources .
The strengths and weaknesses that are
bound with each environmental factor

Environmental Strengths Weaknesses

Factor
Owners Having a larger number of Having a smaller number
them. of them.
Their increased financial Decreased financial
strength. strengths in them.
Their increased knowledge Lack of knowledge and
and experience. experience in them
Managers Their increased training and Decreased training and
experience. development.
Ability to take correct Being backward to take
decisions. decisions.
Taking wrong decisions.
The strengths and weaknesses that are
bound with each environmental factor
Environmental Strengths Weaknesses
Factor
Employees Having clever experienced employees. Having inexperienced employees.
Having versatile abilities in them. Having irresponsible and
Having good attitudes in them. Unaccountable employees.
Having motivated employees. Having unfavourable working
habits in them
Having negative attitudes in
them.
Having inefficient employees.
Organization Having a positive evaluation and value Not having an established value
culture system. system and ethical system.
Having an inherent, developed ethics Not having a high supervision.
and habits.
The strengths and weaknesses that are
bound with each environmental factor
Environmental Strengths Weaknesses
Factor
Organization Proper division of work. Having conflicts among
structure Proper building up of the roles.
organization. Lack of coordination
among sections.
Resources Quantitativeness Having outdated
Qualitativeness resources
Lack of resources
Not having enough
resources.
 ACTIVITY
 Briefly point out how each force mentioned in below table may have an
impact on the activities of the school positively and negatively.

Force Positive Impacts Negative Impacts

Students Being disciplined Having negative attitudes towards

Being skillful learning
Being backward

Teachers

The space of the

classroom

Prefects