Busines Factors

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Factors Affecting Todays Business Environment

Factors Affecting Todays Business Environment

(called The Dynamic New Workplace in Chapter 1)Business FactorsBusiness is impacted by:intellectual capitalglobalizationtechnologydiversityethicscareersscarcity of natural resources / environmental concerns (not in textbook)

Business Factorsthese provide great opportunities and challengesChallenges due to the rate of change uncertainty that they causeOpportunities for companies that are quick to adapt and take advantage of them

Intellectual Capital

the collective brainpower or shared knowledge of a workforce that can be used to create valuethe combined skills and knowledge of an organizations workforcepeople are the ultimate foundations of organizational performancepeople can make or break a company

Intellectual Capitalpost industrialization:is when the wealth in the economy comes more from services and post-production, than production

knowledge worker:someone whose mind is a critical asset to employersmore and more important in post industrialized economies

Intellectual CapitalOpportunities ideas, experience, better use of human resourcesChallengesmay be harder to motivate, challenge, maintain good workersharder to replace highly knowledgeable workersif there is a scarcity of knowledge workers, salaries are high (supply and deman)

Globalizationthe world is one big marketplacethe worldwide interdependence of resources, markets, and business competition the national boundaries of world business have largely disappearedthe world is increasingly arranged in global economic blocs (e.g. NAFTA, EEC)

GlobalizationOpportunitiesbigger market for productslower costs for some material and labourwider source for resourcespeople have greater knowledge of world beyond their own borders

GlobalizationChallengesgreater competition especially hard for small companiesinterdependence international companies rely on each other, and what affects one, might affect the otherwidening the income gap of workers?haves vs. have notsdepletion of natural resources

Technologyequipment and processes that helps an organization to turn inputs into outputsMakes communication, production, and transportation faster and easierinformation technology has transformed the workplacedemand for knowledge workers with technology skills continues to increase

TechnologyOpportunities efficiency, lower labour costs, wider market reach, workplace flexibility

Challengeshigh costs (purchase and maintenance)high need for worker training (skilled workers needed) increased demands to keep up with rate of changereduces demand for unskilled workers

Diversity of Workforcethe composition of a workforce in terms of differences among the members differences include gender, age, race, ethnicity, religion, sexual orientation, and able-bodiednesschanging demographics are making the North American workforce increasingly diverse

Diversity of WorkforceOpportunitiesdiversity of ideas, experience, perspectivewhen companies go global people will have knowledge of other parts of the worldChallengesmay be hard to have smooth integration of people with diverse backgrounds, languages, and beliefsovercoming biases and conflctsmay be language and commn barriers

Ethicsa code of moral principles that sets standards of what is good and right in the conduct of a person or groupmodern society expects that businesses and other social institutions conduct their affairs according to high moral standardsCorporate governance refers to the active oversight of management decisions and company actions by a board of directors

EthicsOpportunitiesfairer treatment of employees, customers, other stakeholdersdoing the right thing can reap credibility and respect (way to differentiate from competition)doing the right thing is always the right thing

EthicsChallengescustomers expect businesses to be ethicalmainstream and social media makes unethical actions visiblemore time-consuming and costlyglobalization makes particularly complex as ethics may be cultural

Careerslarge organizations less likely to be source of long-term careers and ones economic livelihoodpeople increasingly relying on alternative forms of careers such as part-time work, contracts, or own businesses people should maintain a portfolio of skills that are always up-to-date and valuable to potential employers

CareersChallenges for workers - people cannot expect to have a job for life must be adaptable, skills must be portable, and workers must continuously upgrade skillsChallenges for businesses workers may not be as loyal as they once were

CareersOpportunities for workers more variety in career, opportunities to develop new skills; sometimes entrepreneurial incentivesOpportunities for businesses providing flexible work arrangements that suit needs of company

Scarcity of Natural Resources there is a limited supply and high demand for many raw materials (e.g. oil, fish, fresh water) causes: population growth, industrialization of nations, and constant need to growth and consumption

Scarcity of Natural Resource

Challengescost of manufacturing increasescompanies must innovate in order to reduce their reliance on raw materials (petroleum, water, wood, food)companies must find ways to conserve resources

Scarcity of Natural Resource

Opportunities - companies that can provide solutions that reduce our reliance on non-renewable resources have an edge