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Principles of management

Principles of management . Chapter 3 – the environment and corporate culture. Learning objectives –chapter 3. Understand the different environments in which companies operate. Understand how these different environments affect the operation of a company and management.

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Principles of management

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  1. Principles of management Chapter 3 – the environment and corporate culture.

  2. Learning objectives –chapter 3. • Understand the different environments in which companies operate. • Understand how these different environments affect the operation of a company and management.

  3. The organization's environments. • External environment - everything outside an organization’s boundaries that might affect it. The uncontrollable environment. It includes the General and task environments. • Internal environment - the conditions and forces within an organization. The controllable environment.

  4. General Environment The layer of the external environment that affects the organization indirectly.

  5. The General Environment • Technological. • Sociocultural. • Economic. • Legal / political. • International.

  6. GeneralEnvironment Technological TaskEnvironment International the organization’s The layer of the external environment that directly influences operations and performance. Sociocultural Legal/Political Economic

  7. The Task Environment. • Competitors • Customers • Suppliers • Labor Market.

  8. The Internal Environment. Owners Board of directors Employees Physical work environment Organizational culture

  9. GeneralEnvironment Technological TaskEnvironment International Social & cultural Customers InternalEnvironment Labor Market Competition Employees Culture Management Suppliers Legal/Political Economic

  10. Organizational culture. • The set of values, beliefs, behaviors, customs, and attitudes that helps the members of the organization understand what it stands for, how it does things, and what it considers important. • important because it determines the “feel” of the organization. • Its starting point is often the founder.

  11. Organization – environment relationships • Change, Complexity, Uncertainty. • Competitive forces: • Threat of new competitive entrants. • Competitive rivalry. • Threat of substitute products. • The power of buyers. • The power of suppliers. • Environmental Turbulence: • Terrorist attacks. • Workplace violence. • Computer viruses.

  12. How do organizations adapt to their environments. Each organization must assess its own unique situation then adapt through six basic mechanisms • Information systems. • Strategic responses. • Mergers, acquisitions, and alliances. • Organizational design and flexibility. • Direct influence of the environment. • Social responsibility.

  13. Theenvironmentandorganizationaleffectiveness. • The systems resources approach: extent to which the organization can acquire needed resources. • The internal processes approach: internal mechanisms of the organization and forces on minimizing strain. • The goal approach: how well the firm obtains goals. • Strategic constituencies approach: focus is on groups who have a stake in the organization.

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