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This essay discusses whether or not a company should be aware of changes in external environment. It explores different aspects of external environment and its effect on organization.

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The importance of external environment Nowadays, companies are immersed in a constantly changing environment. Not only can the internal environment exert a vital influence on an organization, but also the external business environment. The external environment is composed of all the related departments, the economic system, the social system and many others, which is not merely the natural environment (Ian Brooks et al., 2004:4). This essay discusses whether or not a company should be aware of changes in external environment. It explores different aspects of external environment and its effect on organization. The external environment can be a contributing factor in many respects. Considering its complexity, a PEST analysis (stand for political, economic, social, technological) ...read more.


So if any company can be aware of the changes in 2007 and grasp the investment opportunity, it will certainly make a profit. Furthermore, social system concerns more about people's living style, values, the way of income distribution and consumption. To a large extent, many decisions are based on information from this system since public's taste and demand will affect the scale of production and the feature of its product. To cater for the mass market, a company must timely grasp the trend in need and then adjust any improper strategies. Last, technologic system relates to government's funding on research, the speed of development for new technology and the protection for patent. ...read more.


In spite of the above argument, the external part cannot be ignored under any circumstances since nothing lives in the vacuum. Certain degree of interaction is consisted between the organizations and external environment. Hence it is vital to be aware of changes in external environment. All in all, companies should be alert to any changes in the external environment and keep their steps going forward. As long as we interact with the outside world, we can get benefit in the foreseeable future. REFERENCE LIST Brooks, I., Weatherston, J. and Wilkinson, G., 2004. The International Business Environment. Harlow: Prentice Hall. Mullins, L.J., 2002. Management and Organisational Behaviour. 6th ed. Harlow: Pearson Education. 2007. The External Environment [online]. Available from:http://www.thetimes100.co.uk/theory/theory--the-external-environment--236.php [Accessed 2 November 2009]. 2009. Managing External Influences [online]. Available from: http://www.thetimes100.co.uk/downloads/firstgroup/firstgroup_13_full.pdf. [Accessed 2 November 2009]. ...read more.

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