EFFECT OF ENVIRONMENTAL FACTORS ON CORPORATE PERFORMANCE
Need help with a related project topic or New topic? Send Us Your Topic
DOWNLOAD THE COMPLETE PROJECT MATERIAL
EFFECT OF ENVIRONMENTAL FACTORS ON CORPORATE PERFORMANCE
Chapter one
INTRODUCTION
1.1 Background of the Study.
The environment of any organisation is dynamic in character due to the forces that operate inside it; therefore, managerial actions cannot be carried out freely. Davis (1975) defines an organization’s environment as the sum of all conditions, events, and forces that surround and affect it.
The environment is a major source of uncertainty for a business manager, and as such, it influences both the design of any organisation and the configuration of any organisational structure.
As a result, without a thorough analysis of the environment, a manager finds it nearly impossible to make important operational decisions in his organisation, which are critical to the achievement of various business objectives.
Every level of organisation, formal or informal, operates within a defined environment. The corporate environment can be defined as the collection of conditions and factors that can have a direct or indirect impact on corporate performance in any given organisation.
An organisation functions inside a certain setting. As a social institution, business organisations have a complex and significant interaction with the environment in which they operate.In any corporate organisation, the primary goal of such engagement is to maximise profit and well-being among the firm’s stakeholders.
The mechanism of interaction is the interface between corporate performance and its surroundings. The dynamic environment in which the organisation operates allows it to expand, develop, and produce value and wealth.
It also poses a risk to company performance. The fundamental issue is how the organisation affects people and the natural environment while producing and selling the products or services required to satisfy customers, stakeholders, and other constituents.
Building critical stakeholder relationships across government agencies, consumer entities, environmental groups, and other constituencies allows an organisation to participate in and handle issues and concerns that might otherwise go unnoticed until they became big problems (Rainey 2008).
This implies that the organisation analyse both its internal and external environments. To govern the growth, change, and development of a business organisation
the corporate management must endeavour to control the forces that create possibilities for growth and change, as well as those that represent dangers and necessitate responses (Inyang, 2004).
The environment has changed rapidly and unpredictably, economic variables have become complex, and customers have demonstrated sophisticated behaviours in both domestic and international markets.
Technology and competitive pressure are the most dramatic drivers of change. It is clear that technological change is critical for any corporate firm since it is both a key driving force of industry competitiveness and a source of long-term competitive advantage.
As a result, without a thorough review of an organization’s environmental elements, a manager will struggle to make essential operational decisions critical to achieving various company objectives.
As a result, commercial organisations cannot succeed in isolation; they must exist and operate in an environment characterised by complex interactions between human resources, material resources, and other systems.
We must recognise that an organisation is an integral part of its environment and that they are mutually dependent, with the environment providing the resources and opportunities for the organization’s survival and the organisation, in turn, offering its goods and services to the people who live in its environment (Imaga, 1996).
Need help with a related project topic or New topic? Send Us Your Topic