Business in context - Chapter 1 summary PDF

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BUSINESS IN CONTEXT

What is businees? = the organized effort to produce goods and services to meet the needs of the society  There was a visible growth of “ the business model” in which all organizations are run as businesses Businesses - manufacturing and service industry - non-for profit organizations, - voluntary sector - public services

How can we better understand business? -as a series of activities in a number of different contexts. The contexts can be seen as levels and comprise: 1. Activities or functional level  Innovation, Operations, Marketing, HRM, Finance and accounting 2. Strategic level  this is the nature of management and leadership  it involves the formulation of a set of objectives and the means of achieving those objectives  it copes with issues of ethics and corporate social responsibility (CSR) 3. Organizational level  it deals with goals, structure, ownership, size and organizational and corporate culture 4. Environmental level  GLOBALIZATION is an overriding factor  it deals with the economy, the state, technology, labor and culture

BUSINESS IN CONTEXT- key drivers -

Businesses are a complex network of interrelationships, They are both influenced by and in turn influence the contexts in which they operate There is interaction at each level of the model as well as between models Decisions are made by people with all the subjectivity that entails Decisions that will affect one part of the business, will impact on other parts as well

Influences and interactions -

Interactions are influenced by history Interactions and influences operate between elements at each level or at different levels Influences operate in every direction

When analyzing organizations, we use two types of approaches: 

SYSTEMS APPROACH -all organizations are made up interdependent parts -Organizations can be viewed as a series of inputs, processes and outputs

-Management’s job is to balance the inputs, processes and outputs -Equilibrium between the organization and its environment is very important -FEEDBACK is an important element of the system: from the outputs-> processes and inputs From processes-> inputs

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CONTINGENCY APPROACH -organizations and their activities are shaped by the environment in which they operate -organizations should adapt to the prevailing environment -most of the successful organizations have a “best-fit” with the environments in which they operate (therefore the organizations that do not adapt, will fail)...