MGMT 309: Chapter 3 "Understanding the Organization's Environment"

Interest Groups

A group organized by its members to attempt to influence business. Ex. NRA and Sierra Club

Glass Ceiling

A perceived barrier in some organizations that keeps women from advancing to top management positions.

Regulator

A unit that has the potential to control, legislate, or otherwise influence the organization's policies and practices.

Regulatory Agency

An agency created by the government to protect the public from certain business practices or to protect organizations from one another Ex. EPA and FDA

Boundary Spanner

An employee who accumulates information through contacts outside the organization.

Ethnicity

An ethnic composition of a group of organization.

Competitor

An organization that competes with other organizations for resources.

Supplier

An organization that provides resources for other organizations.

there are two important kinds of regulators?

1. Regulatory agencies 2. interest groups

Political-legal Dimension important for 3 reasons:

1. the legal system partially defines what an organization can and cannot do (regulation of business activity) 2. pro-or antibusiness sentiment in government influences business activity 3. political stability has ramifications for planning (trade relationships with countries that are well-defined and stable)

Competitive Rivalry

Competitive rivalry between firms in an industry.

Problem-Solving Argument

Diverse organizations have a better pool of information from which to draw and make decisions.

External Environment

Everything outside an organization's boundaries that might effect it.

Diversity

Exists in a group or organization when its members differ from one another along one or more important dimensions, such as age, gender, or ethnicity.

Threat of New Entrants

Extent to an ease with which competitors can enter market.

Threat of Substitute Products

Extent to which alternative products/services may replace the need for existing products/services.

Power of Buyers

Extent to which buyers influence market rivals.

Systems Flexibility Argument

Firms must become flexible as a way of managing a diverse workforce, causing the overall organization to be more flexible.

Mergers, Acquisitions, Alliances

Firms that combine, purchase, or form a new venture partnership or alliance.

Cost Argument

Firms that learn to cope with diversity will generally have higher levels of productivity and lower levels of turnover and absenteeism.

Resource Acquisition Argument

Firms who manage diversity effectively will become known among women and minorities as good places to work.

Marketing Argument

Firms with diverse workforces will be better able to understand market segments than those with less diverse ones.

Creative Argument

Firms with diverse workforces will generally be more creative and innovative than those with less diversity.

Two Types of External Environments

General and Task Environment

Board of Directors.

Governing body elected by a corporation's stockholders charged with overseeing the general management of the firm to ensure that it is being run in a way that best serves the stockholders' interests.

__________ firms have a history of building major ties with only one or two major suppliers

Japan

Task Environment

Specific groups and organizations that affect the firm.

Physical Work Environment

The actual physical environment of the organization and the work that people do.

Multiculturalism

The broad issues associated with differences in values, beliefs, behaviors, customs, and attitudes held by people in different cultures.

Internal Environment

The conditions and forces within an organization.

Sociocultural Dimension

The customs, mores, values, and demographic characteristics of the society in which the organization functions. determine the products, services, and standards of conduct that the society is likley to value

International Dimension

The extent to which an organization is involved in or affected by business in other countries.

Power of Suppliers

The extent to which suppliers can influence potential buyers.

Political-legal Dimension

The government regulation of business and the relationship between business and government.

Technological Dimension

The methods available for converting resources into products or services.

Economic Dimension

The overall health and vitality of the economic systems in which the organization operates.

Environmental Scanning

The process of monitoring the environment.

General Environment

The set of broad dimensions and forces in an organization's surroundings that create its overall context. (Economic, legal, political, socio-cultural, international, and technical forces)

Organization Cultural

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.

Five Competitive Forces

The threat of new entrants, competitive rivalry, the threat of substitute products, the power of buyers, and the power of suppliers.

Environment Turbulence

Unexpected changes and upheavals in the environment of an organization.

Uncertainty

Unpredictability created by environment change and complexity.

Owner

Whoever can claim property rights to an organization. includes single individual, partners, individual investors, or other organizations

Customer

Whoever pays money to acquire an organization's products or services.

key element in effective mgmt of an organization is determining the ideal ______ between the environment and the organization and then working to achieve and __________________

alignment, maintain its alignment

internal environment consists of:

owners board of directors employees physical work environments cultures

competition also occurs between?

substitute products ex. ford competes with Yamaha (motorcycles)

the organization is like the __________, and the environment is like the _____________

swimmer, stream

which environment provides useful info more readily than does the general environment? And why?

task environment, because the manager can identify environmental factors of specific interest to the organization

Strategic Partners (or strategic allies)

two or more organizations that work together in a joint venture or other partnerships

corporate governance

who is responsible (and accountable) for governing the actions of a business