Lecture Management practices - Lecture 6

The following will be discussed in this chapter: Economic forces; availability of credit; interest rates; social, cultural, demographic and environmental forces; life expectancy rates; per capita income.

Management Practices Lecture-6 Recap • The Organizational Environment – External Environment • Importance of External Assessment • How to conduct external audit • Key External Factors Key External Factors Today’s Lecture • • Economic Forces – Availability of credit – Interest rates Social, cultural, demographic environmental forces – Life expectancy rates – Per capita income and Economic Forces Monitor Key Economic Variables – Availability of credit – Level of disposable income : – Interest rates: – Inflation rates: inflation is a rise in the general level of The amount of money that households have available for spending and saving after income taxes have been accounted for Interest is a fee paid by a borrower of assets to the owner as a form of compensation for the use of the assets prices of goods and services in an economy over a period of time – Monitor Key Economic Variables – Consumption patterns – Unemployment trends – Worker levels: Workforce productivity is the amount of goods and services that a worker produces in a given amount of time factors affecting labor productivity: • Individual attitudinal • Motivational and behavioral factors • – productivity Technological factors Stock market trends Monitor Key Economic Variables – Foreign countries’ economic conditions – Income differences by region/customer – Tax rates – OPEC policies Social, Cultural, Demographic & Environmental Forces 1.Social, cultural, demographic, and environ mental changes have a major impact on virtually all products, services, markets, and customers 2.Social, cultural, demographic, and environ mental trends are shaping the way people live, work, produce, and consume Social, Cultural, Demographic & Environmental Forces Major impact on: – Products – Services – Markets – customers Social, Cultural, Demographic & Environmental Forces Trends for the 2000’s – – More educated consumers – Population aging – Minorities more influential – Local rather than federal solutions – Fixation with youth decreasing – Hispanics increase to 15% by 2021 – African Americans increase to 14% by 2021 10 Social, Cultural, Demographic & Environmental Forces Key variables – • Number of special-interest groups • Number of marriages • Number of divorces • Number of births • Number of deaths • Immigration & emigration rates 11 Social, Cultural, Demographic & Environmental Forces • Life expectancy rates • Per capita income • Attitudes toward business • Average disposable income • Buying habits • Attitudes toward saving 12 Social, Cultural, Demographic & Environmental Forces • Racial equality • Average level of education • Government regulation • Attitudes toward customer service • Attitudes toward product quality • Energy conservation • Social responsibility 13 Social, Cultural, Demographic & Environmental Forces • Value placed on leisure time • Recycling • Waste management • Air & water pollution • Ozone depletion • Endangered species 14 Summary • • Economic Forces – Availability of credit – Interest rates Social, cultural, demographic environmental forces – Life expectancy rates – Per capita income 15 and Next Lecture • Political, Govt., & Legal Forces • Technological Forces • – Revolutionary technological forces – Internet changes the nature of opportunities and threats Competitive Forces – Collection and evaluation of information on competitors 16 ... Assessment • How to conduct external audit • Key External Factors Key External Factors Today’s Lecture • • Economic Forces – Availability of credit – Interest rates Social, cultural, demographic... 2021 10 Social, Cultural, Demographic & Environmental Forces Key variables – • Number of special-interest groups • Number of marriages • Number of divorces • Number of births • Number of deaths... Cultural, Demographic & Environmental Forces • Value placed on leisure time • Recycling • Waste management • Air & water pollution • Ozone depletion • Endangered species 14 Summary • • Economic