1. INTERNAL AND
EXTERNAL BUSINESS
ENVIRONMENT
Made by: A
bhyuday Shah.

2. Introduction to Business
Environment
 Business environment consist of all those
factors that have a bearing on the
business. The term 'business environment
implies those external forces, factors
and institutions that are beyond the
control of individual business
organizations and their management and
affect the business enterprise.

3.  These forces are customer,
creditors, competitors,
government, socio-cultural
organizations, political parties
national and international
organizations etc. some of those
forces affect the business directly
which some others have indirect
effect on the business.

4. TYPES OF ENVIRONMENT
On the basis of the extent of intimacy with
the firm , the environmental factors may
be
classified into different types-internal
and external.

5. INTERNAL ENVIRONMENT
The internal environment is the environment that has a direct impact on the
business. Here there are some internal factors which are generally
controllable because the company has control over these factors. It can
alter or modify such factors as its personnel, physical facilities, and
organization and functional means, like marketing, to suit the environment.

6. B) MISSION,VISION AND OBJECTIVES
 Vision means the ability to think about the
future with imagination and wisdom. Vision
is an important factor in achieving the
objectives of the organization. The
mission is the medium through which the
objectives are achieved.

7. What is External Environment?
 External Environment of business consist of institution, organizations or forces
operating outside the company.
 The External Environment impact the company directly or indirectly.

8. Marketing Environment
 Includes:
 Microenvironment: actors close to the company that affect its ability to serve
its customers.
 Macro environment: larger societal forces that affect the microenvironment.
 Considered to be beyond the control of the organization.

9. Suppliers:
 Provide resources needed to
produce goods and services.
 Important link in the “value delivery
system.”
 Most marketers treat suppliers like
partners.

10. Competitors
 To be successful, a company must satisfy needs and wants
of consumers better than competitors
 A company should monitor three variables when analyzing
each of its competitors
– Share of Market
– Share of Mind
– Share of Heart

11. External Macro-Environment Forces
External Macro-environment of a Company’s Marketing Program
Social &
Cultural forces
Political &
Legal forces
Technology
Demographics Competition
Economic
Conditions
Company’s
Marketing
Program
Six largely uncontrollable external forces influence an organization’s marketing activity

12. Natural Environment
 Involves the natural resources that
are needed as inputs by marketers or
that are affected by marketing
activities.

13. Technological Environment
Most
dramatic
force now
shaping our
destiny.

14. Cultural Environment
 The institutions and other
forces that affect a society’s
basic values, perceptions,
preference, and behaviors.

15. Marketing Management
Themselves
 Identify with
brands for self-
expression
Others
 Recent shift from
“me” to “we”
society
Organizations
 Trend of decline in
trust and loyalty
to companies
Society
 Patriotism on the
rise
Nature
 “lifestyles of health
and sustainability”
(LOHAS) consumer
segment
Universe
 Includes religion
and spirituality
Cultural Environment
Includes people’s views of…
Goal 4: Explore political and cultural environments

16. Increasing
Legislation
Changing
Government
Agency
Enforcement
Includes Laws, Government Agencies, Etc. that Influence
& Limit Organizations/ Individuals in a Given Society
Increased
Emphasis on
Ethics &
Socially
Responsible
Actions
Political Environment

17. Legal and Regulatory Environment
 Laws and Regulations
 for safety
 for consumer protection
 to protect special interests
 Dangers of litigation--anyone can
sue, and juries often buy it!
 Examples:
 Antitrust
 Fair competition
 Pricing
 “Truth in Lending”--have to tell
people real costs of financing; car
leases now regulated

18. Economic Factors
Inflation
Employment
Disposable income
Business cycles
Energy availability and cost
Others?

19. Prepared
By -
Rishabh Agarwa
 Economic Environment of Business
By Mishra and Puri