Summary: Internal Environment

Read the summary and the most important questions on Internal environment

• 1 Influences of the external environment and the organization's culture

• 1.0 Internal Environment

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• organization’s environments change frequently 

  In a stable environment the components in an organization’s environment change very little 

• Describe the constraints and challenges facing managers in today’s external environment

  · The external environment includes those factors and forces outside the organization that affect its performance. 
  · The main components of the external environment are economic, demographic, political/legal, sociocultural, technological, and global. 
  · These components can constrain and challenge managers because they have an impact on jobs, environmental uncertainty, and stakeholder relationships. 

• 3 Managing Change and Disruptive Innovation

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• Human resources variables 

  · High commitment to training and development 
  · High job security
  

  • Creative People 
    

• Keep external controls minimal

  rules, regulations, policies, and similar organizational controls are kept to a minimum. 

• 4 Managing Strategy

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• Why strategy management important 

  Has a positive impact on performance
  • Helps managers decide how to act in face of change and
  uncertainty
  • Helps complex and diverse organizations work together 

• Step 3 Doing Internal analysis 

  
  -Resources: an organization’s assets that are used to develop, manufacture, and deliver products to its customers.
  -Capabilities: an organization’s skills and abilities in doing the work activities needed in its business.
  -Core competencies: the organization’s major value- creating capabilities that determine its competitive weapons.
  -SWOT analysis 
  -Strengths: any activities the organization does well or its unique resources 
  -Weaknesses: activities the organization does not do well or resources it needs but does not possess 
  -SWOT analysis: an analysis of the organization’s strengths, weaknesses, opportunities, and threats 

• Step 4 formulating strategies 

  Three main types of strategies managers will formulate: 
  • Corporate 
  • Competitive
   • Functional 

• Step 6 Evaluating result

  How effective have strategies been at helping the organization achieve its goals 
  • What adjustments are necessary? 
  - corporate 
  -competitive
  -fucntional 

• Types of Corporate strategy: Growth strategy

  a corporate strategy that’s used when an organization wants to expand the number of markets served or products offered, either through its current business(es) or through new business(es) 
  • Concentration
  • Vertical integration
  • Horizontal integration 
  • Diversification 

• How are corporate strategies managed?

  BCG matrix: a strategy tool that guides resource allocation decisions on the basis of market share and growth rate of SBUs 
  • Stars
  • Cash cows
  • Question marks 
  • Dogs