Business Economics

Topics: Monetary policy, Economics, Money supply Pages: 86 (22660 words) Published: June 27, 2013
-To differentiate between micro and macro business environment

-To explain the terms SWOT, PEST, BPPEST, TOWS and SWOC in environmental analysis.

-To describe the various business environmental forces

-To state the strategic role of the environment on business performance

Section 1: An Overview of Business Economics 1.1.Introduction Business economics is concerned with a total approach to organisational existence and activities. According to G.J de Cronje, in his popular book, “Introduction to Business Management” Business Economics also known as Business Management is the science which studies the functioning of the business organisation. It seeks to promote -Interdependence between a company and its Environment -A continuous assessment of environmental forces -Management decisions that reflect the company’s environmental happenings. 1.2.The Nature of Business Economics Business economics is a broad field and encompasses whatever an organisation needs in order to achieve its objectives. Accordingly, it includes some or all of the following: - General management Purchasing Operations management Publicity Marketing management Financial management Human resources management Production management The above business areas normally constitute the centre of management business decisions. Every company must adequately address the above areas for its own benefit and that of its customers and stake holders. A knowledge of business economics will enable a modern personnel manager to: identify the skills needed in all or most areas of the company describe job purposes across company departments provide key training to the work force take part together with line management in performance appraisals do environmental scanning for recruitment purposes participate in the development of company mission statements, visions and strategic plans, which are all environmentally driven. Section 2: Micro/Controllable Business Environment 2.1. Introduction The micro and controllable business environment refers to the factors that influence a company’s activities which can be manipulated to enable a company to satisfy its clients. Some of these important factors are: -

price planning product management
promotion management place management A company must carefully manage the controllables as they are at its disposal. The controllables must also be designed to focus on the clients of the company 2.2.Players in the Micro-Business Environment For most organisations, the players are likely to include the ones listed below: Customers These are the major purpose of the existence of the company whose needs the company must satisfy.

The customers may be found in one or more of the following types of markets: - consumer market industrial market government market international market Publics Publics are groups with a direct or indirect interest in the company’s activities. Publics would often include internal and external publics such as employees, future employees, potential employees, government, competitors and the finance market. The performance of modern enterprises is no longer judged only on the basis of the profits they make, but also on the extent to which they meet the needs and expectations of their publics. Competitors Few companies are pure monopolists in their areas of business. Most organisations have competitors, active or non-active. A company with competitors must design positioning strategies if it is to survive and achieve its goals. Suppliers These are other organisations or individuals who provide the company with the inputs it needs. Company/supplier relations are crucial if the company is to satisfy consumer needs. Personnel professionals have to see to it that the purchase officers they help recruit meet company expectations.

Channel Agents Most large producers do not sell directly to consumers, but through wholesalers, retailers and...
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