Definitions
↳ Redressing: to fix an undesirable situation
↳ Nepotism: the practice among those with power or influence of favouring
relatives/Friends (giving them jobs)
↳ Retrenchment: business cuts down on employees to reduce costs
↳ Go-slow: a situation when employees work at a slower pace
↳ Strike: a situation where workers refuse to work until their demands are a dressed by
employers
Micro
↳ internal business environment (everything inside the business) also known as internal
operating system
Components
• vision, mission statement, goal, objectives
• org structure
• org culture
• org resources
• management & Leadership
• 8 Business functions
Market
↳ immediate external environment
limited control or influence
Components
• Consumers
• suppliers
• intermediaries
• competitors
• other org/ civil society
Macro
↳ broad external environment
↳ no control or influence
↳ business needs to adapt to macro environment
Components
• social
• political
• legal
• economic
• technological
• physical
• global/international
Business Control Over Environments
• The success and profitability of a business depend on factors in three business
environments
• Businesses may try to influence or control some factors, such as government laws, to
create favorable conditions.
• However, not all factors can be controlled, with some being easily controlled by the
business (e.g., prices of
goods/services) while others are more difficult (e.g., suppliers, competitors)
• Factors in the macro environment are usually beyond a business's control.
Control Over The Micro Environment
- Establishing and revising vision, mission statement, goals, and objectives
- Engaging strategic management systems for plan implementation and revision
- Establishing policies, procedures, and management structures
- Efficient and effective use of business resources
- Promoting understanding of business culture and alignment with goals and values
- Leading, organizing, directing, and controlling employee actions for business
objectives
Influence Over Market Environment
- Limited control over the market environment
- Possible to influence and shape certain components
- Some components easier to influence than others
Customers
• Influence consumer decisions through marketing strategy
• Marketing strategy includes objectives, strategies, and activities
• Conduct market research to identify target market needs and wants
• Devise strategies to provide goods/services to satisfy those needs
• Attract and influence customers through marketing campaigns
• Examples: promotional sales, discount prices, extended working hours, persuasive
advertisements
Suppliers
• Influence supplier decisions and actions
• Sign long-term contracts for inputs at fixed prices
• Form strategic alliances with suppliers
• Buy in bulk to secure discounts
• Ensure adequate supply of raw materials
Competitors
• Limited or no influence over competitors
• Form strategic alliances with other businesses
• Join community business forums for collaboration
• Create a consortium with other business owners
• Share ideas and resources for mutual benefit
Regulators
• Single business has limited influence over regulators
• Regulators make rules and regulations for businesses
• Influence on regulators can be achieved when businesses join together
• Businesses can have a representative lobby with regulators
• Lobbying can aim to change or pass legislation for business goals
Unions
• Businesses can influence decisions of unions through maintaining good relationships
• Engage in collective bargaining sessions with unions
• Explain concerning issues and perspective to union leaders
• Persuade unions to side with business viewpoint
Influence Over The Macro Environment
• Businesses have no control over the macro environment
• Factors not within business control include political, economic, social, technological,
legal, and environmental factors
• Entrepreneurs cannot directly control macro environment components
• Joining forces can enable entrepreneurs to influence aspects of the macro
environment
P → policies + political stability
E → inflation + foreign currency
S → socio-economic issues
T→ new tech + internet
L → legislation + labour laws
E → climate change + environment
How B Can Influence Macro
① B can lobby for mutual trust → group of B's can use influence + combined powers to
persuade gov to change regulations + policies
② B can hedge against inflation by investing surplus assets into investments
③ B can network to share info on how to overcome challenges
Ways B Can Be Involved In Macro
① Create job opportunities for communities Be involved in social responsibility
programmes → improve the welfare of community
② Improve export markets → expand African markets
③ Do scientific research → improve traditional medicines
④ Engage in collective bargaining + lobbying to improve working conditions or change
government legislation
⑤ Private-Public partnerships → provide infrastructure
⑥ Provide education + training programmes → to improve service delivery
Benefits of Businesses Involved in the Macro Environment
• Gain good publicity and attract loyal customers
• Attract and retain skilled employees in their communities
• Gain government tenders and contracts.
• Attract top investors
• Prevent environmental damage by decreasing the business' carbon footprint
.
