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BP-CIS : Business Perspectives of CIS
• Fundamentals of Business Environment
• Business Functions
• Business Organizations
• Business Processes
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BP - CIS : Fundamentals of Business Environment
What is Business Environment?
«Business» is the continuous production and distribution of
goods and services with the aim of earning profits under
uncertain market conditions.
«Environment» refers to all external forces which have a
bearing on the functioning of business.
«Business Environment» is the aggregate of all conditions,
events and influences that surround and affect it.
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BP - CIS : Fundamentals of Business Environment
Types of Business Environment
Internal Environment
Refers to all the factors
that are within an
organization which impart
strengths or cause
weaknesses of strategic
nature.
External Environment
Includes all factors
outside the organization
which provide
opportunities or pose
threats to the organization.
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BP - CIS : Fundamentals of Business Environment
Major Factors of Business Environment
http://www.leoisaac.com/planning/strat016.htm
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BP - CIS : Fundamentals of Business Environment
Internal Business Environment - Organizational Culture
The attitudes of staff and volunteers make a very significant
difference. Negative attitudes can severely impact on the
organization's ability to implement strategies for
development despite however thorough the planning
processes. Positive attitudes will not only make
the management task easier but also will be
noticed and appreciated by customers of the
business or members of organization.
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BP - CIS : Fundamentals of Business Environment
Internal Business Environment – Human Resources
The knowledge, experience and capability of an
organization's workforce is a determining factor of success.
Organizations pay particular attention to the recruitment
of staff and also to engage in the training
of staff and volunteers to build the
organization's capability. In pursuing
both recruitment and training strategies,
an organization is often limited by its
financial strength.
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BP - CIS : Fundamentals of Business Environment
Internal Business Environment - Organization Structure
Organization structure is essentially the way that the work is
divided among its workforce.
In a non-profit organization, the organization includes the
management board or committee, the salaried staff of the
organization and all the volunteers that have roles as
coordinators of various business functions.
When an organization is a for-profit business
that operates in a very competitive environment, its
organization structure may help or hinder the
ability of the organization to react to change.
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BP - CIS : Fundamentals of Business Environment
Internal Business Environment - Physical Assets
The internal environment of the organization can be made
richer or poorer by its assets.
• The organization's premises can be pleasant and uplifting,
or demure and depressing.
• The availability of equipment can
significantly impact on the internal
environment. Equipment not of the
expected standard may hinder the
performance of staff.
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BP - CIS : Fundamentals of Business Environment
Internal Business Environment - Profit and Cash Flow
Financial strength (profit and cash flow) is a factor in its own
right that influences the internal environment of the
organization. Despite however good other internal factors
may be, it is very difficult for an
organization that is too short of cash
to implement strategies within the
strategic plan. If the organization
struggles financially this can impact
on staff morale as budgets need to be
excessively tight.
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BP - CIS : Fundamentals of Business Environment
Internal Business Environment - Management
The capability of the management team and the leadership
styles employed by managers will also have a major impact
on the morale of staff (and volunteers in a non-profit
organization) and organization culture. More contemporary
forms of management involve workers
İn decision making processes and
trusting that, although managers and
workers have different viewpoints,
they largely benefit by working together
to achieve the business objectives.
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BP - CIS : Fundamentals of Business Environment
External Business Environment - Climate
Climate change is an threat because the jump of change may
be recognizable only if considered on a decade-by-decade
basis. The effect of climate change will not fall equally on
all nations and all businesses. Businesses that depend
directly on a good supply of water will be adversely effected
if climate change results in reduced rainfall.
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BP - CIS : Fundamentals of Business Environment
External Business Environment - Economy
Prevailing economic conditions of the nation will have an
effect on the spending patterns of citizens. Increases in
interest rates and/or a high level of unemployment will
depress consumption of non-essential goods and services.
Economic conditions are global as well as national, and
when there is a global financial crisis, changes in external
environment can be
dramatic.
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BP - CIS : Fundamentals of Business Environment
External Business Environment - Technology
Technological change has been rapid in the last 50 years and
is a factor in the external environment that constantly exerts
pressure on the business or organization. If businesses do not
adapt sufficiently quickly to technological change, they risk
losing market share. It's not just that technological change
affects the design of products, but even delivery of services
can change.
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BP - CIS : Fundamentals of Business Environment
External Business Environment - Political
Like law, changes in government policy can be well notified
and discussed, or without warning. Organizations depend on
government financial assistance can be effected when there
is a change of government where such funding assistance
can disappear in a short space of time.
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BP - CIS : Fundamentals of Business Environment
External Business Environment - Legal
Taxation is one of most obvious changes in law through
regulation. Sometimes taxation changes occur overnight
with little warning and sometimes there is plenty of time for
the business to prepare. Other law changes that commonly
affect business include Workplace Health and Safety,
Industrial Relations, Consumer Protection and
Environmental Law.
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BP - CIS : Fundamentals of Business Environment
External Business Environment - Competition
The strength of business competition is a constantly
changing factor in the external business environment. Not
only will competitors come and go, but they will also change
marketing strategies, product lines and prices. Often such
changes are not heralded and business managers must be
alert as to what competitors are doing.
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BP - CIS : Fundamentals of Business Environment
External Business Environment - Media
The media is undergoing rapid and significant change. The
main driver of this change is technology and the rise of the
internet. Newspapers once carried many pages of job adverts
but now this business is conducted by online recruitment
companies such as Seek.
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BP - CIS : Fundamentals of Business Environment
External Business Environment - Demographic
There is constant change in the make-up of the population.
Some of these changes include an increasing proportion of
elderly citizens, increasing number of two-income families,
increase in the age at which people marry, increasing ethnic
diversity, suburbs which were once dominated by young
families now have few. These demographic changes can
have a significant effect locally.
https://blogs.ntu.edu.sg/hp331-2012-celestine/theories-ofattitudes-and-practices/attitudes/environmental-attitudessocio-demographic-variables/
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BP - CIS : Business Functions
Business function is a process or operation that is performed
routinely to carry out a part of the mission of an
organization. Major business functions are;
• Accounting / Finance
• Production / Operations
• Sales / Marketing
• Human Resources
• Administration
• Information Technology
• Purchasing
• Research and Development
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BP - CIS : Business Functions
Accounting / Finance
Accounting → recording and reporting financial activity and
transactions.
Finance → investment decisions, financial decision, dividend
decisions.
http://heyaccounts.com/accounting-system-integration/
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BP - CIS : Business Functions
Production / Service Delivery
The process of converting raw materials into finished goods
and services, for the customer.
ww.slideshare.net/blackwell3/bm11-business-functions-and-sectors-presentation
Issues to be considered: plant location and layout, plant
building, production planning, repair and maintenance and
quality control.
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BP - CIS : Business Functions
Sales / Marketing
Marketing is the process of identifying, anticipating and then
meeting the needs and requirements of consumers in order to
make a profit. In contrast, selling involves persuading
customers that your products or services provide the benefits
that they are looking for.
http://myimagecollection.net/marketing+and
+sales+tools?image=583651484
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BP - CIS : Business Functions
Human Resources
Support systems responsible for personnel sourcing and
hiring, applicant tracking, skills development and tracking,
benefits administration and compliance with associated
government regulations.
http://www.pptssolutions.com/blog/odoobenefits-for-hrms/
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BP - CIS : Business Functions
Administration
It is tasked with providing administrative and logistical
support to the entire organization.
• General Office Management and Running
• Transport Management
• Registry Management
• Assets Management
• Property Management
• Security and Safety
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BP - CIS : Business Functions
Information Technology
Responsible for the maintenance of IT infrastructure and
associated processes together with the maintenance of
telecommunication infrastructure and associated processes
of the organization.
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BP - CIS : Business Functions
Purchasing
Buying of goods/services required by the organization to
deliver its services or make its products.
http://www.gobusiness.net.au/Pages/pu
rchasing.aspx
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BP - CIS : Business Functions
Research and Development
Issues to be considered: new product development, product
improvements, competitive advantage, product testing,
efficiency gains, cost savings.
http://www.gison.com.tw/tr/page/res
earch.html
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BP - CIS : Business Organizations
Business organization is a social unit of people that
is structured and managed to meet a need or to pursue
collective goals. All organizations have a management
structure that determines relationships between the
different activities and the members, and subdivides
and assigns roles, responsibilities, and authority to carry out
different tasks. Organizations are open systems; they affect
and are affected by their environment. Main types of
organizational breakdown structures are as follows.
• Functional
• Matrix
• Pure Project
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BP - CIS : Business Organizations
Functional
This traditional organization, functional structure is based on
the subdivision of product lines or disciplines into separate
departments, together with their vertical hierarchy.
Essentials of Project Management,
Kamaraju Ramakrishna, 2010
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BP - CIS : Business Organizations
Matrix
The topology of the matrix
structure has the same format as
a mathematical matrix, in this
case the vertical lines represent
the functional departments’s
responsibility and authority,
while the horizantal lines
represent the project’s
responsibility and authority.
Essentials of Project Management,
Kamaraju Ramakrishna, 2010
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BP - CIS : Business Organizations
Pure Project
The pure poject organization structure is similar in shape to
the functional organizational structure except now all the
departments are dedicated to the project.
Essentials of Project Management,
Kamaraju Ramakrishna, 2010
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BP - CIS : FBE, BF, BO
CourseWork
• State three external and three internal factors of business
environment. Then give an example for each factor
you’ve stated considering the ............ system and finally
explain briefly effect of each factor on the ........... system.
• Give a process example for each business function.
• Compare types of business organizations in terms of
advantages and disadvantages for the .......... system.
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