Principles of Management Lecture 6 - Globalisation

The set of global forces and conditions that operates beyond an organization’s boundaries but affects a manager’s ability to acquire and utilize resources.

• An organization that operates and competes in more than one country
• Uncertain and unpredictable

The set of specific and general forces that work together to integrate and connect economic, political, and social systems across countries, cultures, or geographical regions so that nations become increasingly interdependent.

General Environment
Wide-ranging global forces that affect an organization and its task environment, No direct control

• technological forces
• sociocultural forces
• demographic forces
• political and legal forces
• economic forces

Task Enviornment
Forces that affect an organization’s ability to obtain inputs and dispose of its outputs, Influence managers daily

• Competitors
• Distributors
• Customers
• Suppliers

Individuals and organizations that provide an organization with the input resources that it needs to produce goods and services

Raw materials, component parts, employees

Global outsourcing: The purchase or production of inputs or final products from overseas suppliers to lower costs and improve product quality or design

Organizations that help other organizations sell their goods or services to customers

Powerful distributors can limit access to markets through its control of customers in those markets

Retailers, online platforms, trading companies, etc

Individuals and groups that buy goods and services that an organization produces

A manager’s ability to identify an organization’s main customer groups offer them desired products is a crucial success factor

Organizations that produce goods and services that are similar to a particular organization’s goods and services

Rivalry between competitors is potentially the most threatening force that managers deal with