Global Business Environmental Forces

This report analyzes the practical implication and analysis of some of the important aspects of Organizational Behavior in two organizations – Buddha Air and Yeti Airlines and presents some recommendations on motivation, use of technology and other aspects. The analysis and interpretation of the report is solely based on the small survey, questionnaire limited to few aspects of OB and interviews with the manager of the organizations.

The major content of this report is based on the analysis of the impact of biographical characteristics on employee output, ability job fit, personality and organization fit, comparison of motivational practices, desirable and non desirable behavior of employee at work. Regarding our analysis, we have tried to compare our results with general view. In some cases, it showed similarity and in some cases there were contrasting results. Because of the time factor, employees’ biases and small sample size survey, our results could not be generalized and compared with any empirical evidence, so we may have had contrasting results. To motivate employees, both the organizations use the practices of giving bonuses, fringe benefits, festival leaves and allowances, regular job rotation, trainings, appraisal system and others.

The desirable behavior in both the organizations can be numerated as time and efficiency concern, commitment to duty, initiative and resourceful, dependability, willingness and readiness to perform, interpersonal skills, personal effectiveness where some of the undesirable behaviors were indiscipline, unreliability, job incompetency, unethical behaviors, unsystematic and unorganized approach to job. Buddha Air and Yeti Airlines concentrates on modern technological advances to design a systematic communication channel, participatory management, more training programs and workshops, rewards system to effectively manage its employees.

Business environment is the total situation of all the factors or forces surrounding and influencing operation and development of a business firm or company. The ICFAI center for management research state that the global business environment can be defined as the environment in different sovereign countries, with factors exogenous to the home environment of the organization, influencing decision making on resource use and capabilities. Forces outside the firm’s traditional boundaries are increasingly important in determining the firm’s success. These forces in “the environment of business” differ among nations and over time, continually confronting the firm with new issues that require modifications in strategies and management practices.

Global business and marketing strategies are highly influenced and determined by the findings an analysis of foreign and international environmental forces. Simply knowing the demand situation, customer’s behaviors and operational forces in market is inadequate. In the case of international business or marketing a detailed analysis of environmental forces must be done. The environmental forces that play an important role are as follows:

1. Political forces
2. Legal forces
3. Socio-culture forces
4. Economic and socio-economic forces
5. Financial forces
6. Labor forces

These factors and changes in them present both threats and opportunities that require shifts in marketing plans. To spot trends and other signals that conditions may be in flux, marketers must continually monitor the environment in which their companies operate. To get a better idea of how they affect a firm’s marketing activities, let’s look at each of the areas of the external environment.

1. Political forces: The political environment in a country influences the political climate, stability and security, types of government and philosophies, nationalism, political risks, international and diplomatic relations, etc.
2. Legal forces: The legal environment includes legal system, international laws and institutions, all legal provisions on trade and investment that affect the operation and development of foreign business firms and companies, and enforcement mechanism.
3. Socio-culture environment forces: It includes attitudes, beliefs, customs, religions, etc. of the people.
4. Economic and socio-economic environment forces: It includes income and distribution of income, production costs, consumption expenditures, demographic features and distribution, etc.
5. Financial forces: Financial forces include inflation, monetary situation, foreign exchange market, policies and reserves, etc.
6. Labor forces: Labor forces includes composition, skills, attributes union, strikes, etc.

Economic and Socio-economic Forces

The economic and socioeconomic forces of a country stand to be most important in gearing the growth and the development of the country. It is needless to mention that these economic and socio economic forces are variable and keep changing from one country to another. While the economic forces become accountable for the great changes and movements in many countries, the socioeconomic forces collectively lead to changes in many societies. The impact of the forces is ever changing and depends on numbers of factors ranging from the social, political and economical externalities. Many economic policies together may make upheavals in many societies. Again, there are many societies where social values, beliefs and philosophies lead to considerable alterations of the economic system of the society.

Moreover, there are many societies, where the impact of the economic and socioeconomic forces has been immense with all their effects on the society on the whole. Hence, the impacts of these forces are variable and are controlled by numbers of additional factors. Below there is discussion on the economic and social forces that lead to changes in the societies. Economic forces correspond to the nature and course of the economy within which the business operates. Economic factors always have their tremendous impacts on the business for organizations. The common state of the economy for instance, depression, recovery, or prosperity, recession, interest rate, stage of the economic cycle, fiscal policy, balance of payments, monetary policy, are some of the key variables in corporate employments, investment, and the pricing decisions.

The effect of growth or turn down in GNP or the gross national product and increases or decreases in the interest rates, inflation, and the price of the dollar are held as the prime instances of considerable impact on the business operations. In order to evaluate the local situation, an organization may seek information relating to the economic base and prospect of the region and in addition, the impacts of this viewpoint on the unemployment, wage rates, non-refundable income, and mostly on the transportation and commercial bases. The state of the world economy is most critical for organizations working in such regions. The social forces are no less impactful when compared to the economic forces. Social forces comprise societal trends, traditions, consumer psychology, values, and a society’s opportunities of business.

The subsequent factors are some of the main concerns in the social environments. Ecology, for instance, pollution and global warming, demographics for instance, feeble workforce in developed countries, population growth rates, and the high educational requirements are all important factors. In addition to these factors, quality of life comprising standard of living, safety, education, health care, and many of the noneconomic activities are also main factors. Furthermore, social issues can rapidly become political and even officially permitted issues. Social forces are often become decisive because of their impact on people’s behavior. For an association to survive, the good or service must be required, thus customer behavior is referred as a split environmental behavior.

Behavioral factors also make impacts on the organizations from inside, specifically, the employees and the organization. A society’s prospects of business present other constraints and opportunities. These expectations originate from miscellaneous groups referred to as the stakeholders. Stakeholders comprise an organization’s members of the board of directors, owners or the stockholders, creditors, managers and operating employees, customers, suppliers, distributors, and other interest groups at the broadest level, stakeholders comprise the common public.

Levels of Economic Development

Developed: A classification for all industrialized nations, which are the most technically developed. A developed country or “more developed country” (MDC), is a sovereign state that has a highly developed economy and advanced technological infrastructure relative to other less developed nations. Most commonly the criteria for evaluating the degree of economic development are gross domestic product (GDP), the per capita income, level of industrialization, amount of widespread infrastructure and general standard of living.

Which combines an economic measure, national income, with other measures, indices for life expectancy and education has become prominent. This criterion would define developed countries as those with a very high (HDI) rating. However, many anomalies exist when determining “developed” status by whichever measure is used Developed countries produce large quantities of goods, services, and in general do a lot of manufacturing. Countries such as these use science to improve technology and generally have good health care and education for their people, as well as adequate food, clothing, and housing.