MGT Ch3

general environment

the broad, complex factors that affect all organizations such as legal systems, population trends, economic conditions, and workers' educational levels

stakeholder orientation

the degree to which a firm understands and addresses stakeholder demands

the power of the customer increases when

the firm's product is not significantly different from that of its competitors; the cost of the product is a significant expense for the customers; the customer is a major buyer of the firm's total goods or services

corporate governance

the formal system of oversight, accountability, and control for organizational decisions and resources; most corporations have some form of oversite

economic dimension

the overall condition of the complex interactions of economies throughout the world (interest rates, inflation, unemployment rates, gross national product, and the value of the US dollar)

task environment

those factors that have a direct effect on a specific organization and its managers, including customers, suppliers, competitors, substitutes, and potential new entrants to the industry

primary stockholders

those who have a formal and/or contractual relationship with the firm, such as customers, suppliers, employees, regulators, investors, and communities

customers

those who purchase an organization's goods and/or services; could be the final recipient (user of the good or service or serve as an intermediary

legal element

use of the judicial branches of government to resolve disputes between parties

Current customers

want to know everything about them

Competitor's customers

why do they choose their competitor over us?

technological dimension

within the general environment, the knowledge and process of changing inputs (resources, labor, and money) to outputs (goods and services)

political-legal dimension

within the general environment, the nature of the relationship between carious areas of government and the organization (political legal and regulatory elements)

You own a computer company, and you launch a joint venture with a competitor to create a new super-speed tablet. Unfortunately, you do not realize that your operating system is totally incompatible with that of the other company's, and the new venture fails miserably. This is the result of

your failure to cope with the technological dimension of the general environment.

activities of stakeholder orientation

-the organization-wide generation of data about stakeholder groups and assessment of the firm's effects on these groups -the distribution of this information throughout the firm -the organization's responsiveness as a whole to this intelligence

An American firm's refusal to enter into a binding contract with a Russian oil firm because of the lack of clarity of Russian law in this area is based on the American firm's analysis of which dimension of the general environment?

Political-legal dimension

stakeholder map

a representation of the organization's stakeholders and their stakes

internal environment

all factors that make up the organization, such as the owners, managers, employees, and board of directors

external environment

all of the factors outside the organization that may affect the managers' actions

environment

all of those factors that affectthe operation of the organization

Market

all the consumers willing and able to buy a product

who has the important task of representing the stockholders in their capacity as owners

board of directors

In analyzing their external environment, most organizations find that it presents

both threats and opportunities.

values

certain beliefs that affect different evaluations and behavior related to firms and products

The lowering of the fat content in many American food products is an example of

changing values regarding food products

potential new customers

companies not currently operating in a business's industry but which have a high potential for entering the industry

The fact that Americans are becoming older and more affluent is an example of

demographic characteristics.

The task environment includes all of the following except

environmentalists

substitutes

goods or services that may be used in place of those furnished by a given business

secondary stakeholders

groups that have a less formal connection to the organization, such as environmentalists, special interest groups, and the media

Because there are numerous suppliers of potatoes for such major fast-food chains as McDonald's, Wendy's, and Burger King, the suppliers

have little control over the restaurants.

Potential customers

how do we make them decide to buy our product? Not in the market yet

demographics

measures of various characteristics of the people and social groups who make up society (age, gender, income)

suppliers

organizations and individuals who provide resources to other organizations

competitors

other organizations that produce similar, or in some cases identical, goods or services; often the most powerful force in a firm's operations; prices, services, and after-salessupport are all directly compared with

global dimension

pertaining to the general environment, those factors in other countries that affect the organization

The Sierra Club makes a major effort in Washington to pass a law banning the logging of old-growth forest in Oregon through its political action committee (PAC). It is operating in the

political element of the political-legal dimension.

political element

refers to the businesses' involvement in forming public policy

groups of general environment forces

sociocultural, political-legal, technological, economic, and global dimensions of the environment

The Union Electric Company, a St. Louis utility, buys a large shipment of coal from Peabody Coal Company for use in its coal-fired plants. Peabody is one of Union Electric's

suppliers

The fact that U.S. businesses now frequently engage in task environment. trading relations is an illustration of what dimension of the general environment?

task

You own a bakery that makes fine bran muffins, but you lose a customer to another bakery that offers him a 25 percent discount for similar muffins. You are facing a challenge in the

task environment.

You own a gourmet restaurant in Atlanta. You send your chef, Pierre LePeachtree, to a major international restaurant-owners' meeting so he can find out what some of the hot new entrees are around the world. You are being sensitive to the

task environment.

sociocultural dimension

the aspect of the general environment that includes the demographics, attitudes, and the values of the society within which an organization operates (reference groups, social class, opinion leaders, and subcultures)