Why are organizations affected by their environments? In order to answer this question, let's look at two very different organizations: Basic Bolt Company and Terrific Technologies.
Basic Bolt Company sells bolts to large manufacturing companies as components to make large machines and engines. They face a relatively static environment with few changing environmental forces. Currently, there are no new competitors in their market, few new technologies being discovered, and little to no activity from outside groups that might influence the organization.
Opposite from this, Terrific Technologies is an Internet marketing start up that faces a dynamic environment with rapidly changing regulations from the government, new competitors constantly entering the market, and
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It exposes the strengths and weaknesses found within the organization. Factors that are frequently considered part of the internal environment include the organization's culture, mission statement, and leadership styles.
The internal environment of Basic Bolt Company is very different from Terrific Technologies. Basic Bolt Company's leadership is results- and deadline-driven, distant, detached, and generally unconcerned about their employees' welfare or morale. Their employees are not especially dedicated to the company and are happy to leave if the opportunity arises.
Terrific Technologies' leadership style is extremely hands-on using a high degree of creativity, ingenuity, and imagination in solving organizational problems. Their managers are concerned about employee moral and welfare and go above and beyond what is necessary to make their employees feel valued and important. Their employees are very loyal to the company and are typically happy with their jobs.
External
Our leadership is founded on talented employees effectively applying advanced technology and sound business management. Northrop Grumman employees lead through competence, creativity, and teamwork (Northrop Grumman, 2016). In addition, we strive to attract and retain the best employees by providing an inclusive work environment wherein employees are receptive to diverse ideas, perspectives, and talents to help solve our toughest customer challenges. Northrop Grumman develops and maintains some of the most technically advanced products, programs, and services in the world. For this reason, our continued success requires us to provide the education and development needed to help our people grow (Northrop Grumman, 2016).
The internal environment of any company forms the premise or basis for internal analysis. Internal analysis actually sees manager or business leaders basing their organization's pursuit of "...market opportunities not only on the existence of external opportunities but also on a very sound awareness of their firm's competitive advantages arising from the firm's internal resources, capabilities, and skills" (p.148). Hence, internal analysis sees a close look being taken at the components of a company's internal environment with the aim of improving its competitive edge. The components of a company's internal environment are based on the approach taken to internal analysis. Among the approaches used to identify and analyze the elements
These factors create certain expectations and requirements for organizations, which in turns determine the organization's direction and strategy. Whereas internal environment is made-up of several internal subsystems. Internal subsystems work together systematically and drive the organization in the direction which is in conformity to external environment demands; thereby making the organization effective and a good fit with external environment. (McShane & Steen, 2012, p.6)
Joe Hinrichs, a recent Harvard Business school graduate, was hired in February 1996 to run the General Motors’s the Fredericksburg Torque Converter Clutch (TCC) manufacturing plant. At 29 years old, Hinrichs was GM’s youngest plant manager. Hinrichs was inheriting a poor performing plant that continually underachieved, losing money year after year. Improvements were desperately needed to increase the efficiency of the manufacturing process and reduce operating costs. GM had considered shutting down the plant; however, when a new bonding process, using carbon fiber, for the TCC was approved in 1995, GM instead invested thirty million dollars into the Fredericksburg plant to incorporate the new process.
The following paper is about a company that is at the top level of their industry in selling their products and services. The background of this company describes about what kind of company this is and the types of products and services it provides to their customers. This section also includes the recent performance of this company and the varying aspects of what their target customers and whose is the competition.
Albatross Anchors is a small family owned business that began in 1976. The company has grown exponentially over the years with more than one hundred and thirty employees. As the company grew, their operational issues in the production and administrative area grew as well. The organization has been faced with a lack of updated technology, out dated equipment, an inefficient layout which violates the U.S. safety and environmental standards, and a disorganized administration office. Therefore, production is not running smoothly,
“All things are possible with the right technology!” said Helmut Schwartz, the recently appointed CEO of Globe Alive, Inc. (GAI), an Edmonton-based software company. Speaking at a monthly management meeting of GAI executives, Schwartz continued. “With the right technology in our organization, we can facilitate efficient communication between global partners, discern in-bound supply chain elements from out-bound shipments, expedite customer orders in a timely manner, electronically transfer funds around the world, and monitor employees to ensure they are being productive. And that list is by no means exhaustive. Believe me when I say, all things are possible with the right technology. When I shared
It is very clear that it takes more than great ideas in order to stay on top in the technology arena. Competition is never ending and sometimes a company can spend more time keeping the competition away then improving on their vision. The videos “Browser Wars” and “Search” conveyed that as young upstart companies worked to get their ideas out into the marketplace.
These factors influence the internal environment of an organisation and they help in identifying the past and the present of the company, It also provides a frame work for reviewing strategy position and direction of the company.
The internal factors are inclusive of the marketing mix of the organization and the organizational goals. The product itself is a huge
It is defined as all the forces or conditions that are available within an environment that affects an organization and business. It is also known as controllable factors because business can control them. The internal environment deals with the management of resources like human resources, physical resources, technology, monetary resources and others that constitute the organization in order to implement or execute a strategy. Internal environment also includes culture and other intangible aspects like teamwork, coordination, efficiency level of employees, employee’s salaries and monitoring costs. The strategy for competition should also be in sync with the internal resources especially the internal environment.
The partnership at Hefty Hardware between IT and the business is not effective. One of the core problems faced by Hefty Hardware was the lack of a productive, working relationship between the company’s IT and business divisions. The four building blocks needed for a foundation on which a solid relationship could be constructed; competence, credibility, interpersonal interactions, and trust, were not present between the two divisions (McKeen & Smith, 2012). The business division felt IT lacked competence when dealing with business needs, demonstrated by the IT department not having knowledge of Hefty Hardware’s basic business concerns, goals or processes.
Organizational environments: Reciprocal relationships exist between an organization and environments; information systems provide organizations a way to identify external changes that might require an organizational response.
The internal environment consists of the inherent competencies of the firm and the structure of its internal systems and processes. It is imperative for the organization to conduct an internal analysis
The internal business environment includes factors within the organisation that impact the approach and success of the business operations. Formerly presented as core competencies, capabilities, leadership style and culture of an organisation. To understand its sources of competitive advantage from within a firm or an organisation will implement specific tools such as SWOT analysis (Strength, Weaknesses Opportunities and Threats), Value chain analysis, Resource based view, VRIO framework and BCG Matrix for instance.