Chapter 5: The External Environment
Task Environment
Actual and potential competitors, suppliers, and buyers (customers or distributors); firms that provide substitute products to those sold in the industry; and firms that provide complements.
Database
An electronic storage file where information is kept; one use of databases is to store vast amounts of information about consumers.
Economies of Scale
Cost advantages associated with large operations.
Technology
Everything from phones and copiers to computers, medical imaging devices, personal digital assistants, and the various software programs that make business processes more efficient and productive.
Internal Environment
Everything inside a firm that affects managers' ability to pursue actions or strategies.
External Environment
Everything outside a firm that might affect the ability of the enterprise to attain its goals.
Barriers to Entry
Factors that make it difficult and costly for an organization to enter a particular task environment or industry.
Empowerment
Giving frontline workers the responsibility, authority, and freedom to respond quickly to customer requests.
Customers
Individuals and groups that buy the goods and services that an organization produces.
Suppliers
Individuals and organizations that provide an organization with the input resources that it needs to produce goods and services.
Distributors
Organizations that help other organizations sell their goods or services to customers.
Potential Competitors
Organizations that presently are not in a task environment but could enter if they so choose.
Competitors
Organizations that produce goods and services that are similar to a particular organization's goods and services.
General Environment
Political and legal forces, macroeconomic forces, demographic forces, sociocultural forces, technological forces, and international forces.
Productivity
The amount of output you generate given the amount of input.
E-commerce
The buying and selling of goods and services over the Internet.
Identity Theft
The obtaining of private information about a person, such as Social Security number and/or credit card number, and using that information for illegal purposes, such as buying things with it.
Global Outsourcing
The purchase of inputs from overseas suppliers or the production of inputs abroad to lower production costs and improve product quality or design.
Task Environment
The set of forces and conditions that originate with suppliers, distributors, customers, and competitors and affect an organization's ability to obtain inputs and dispose of its outputs because they influence managers on a daily basis.
Demography
The statistical study of the human population with regard to its size, density, and other characteristics such as age, race, gender, and income.
Business Environment
The surrounding factors that either help or hinder the development of businesses.
General Environment
The wide-ranging global, economic, technological, sociocultural, demographic, political, and legal forces that affect an organization and its task environment.
Brand Loyalty
customers' preference for the products of organizations currently existing in the task environment.
