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The environment in which all the business activities take place. Business environment encompasses the climate or set of conditions, Economic , social,political, or institutional in which business operations are conducted. (Arthur M.Weimer)

Aggregative Inter-related Relative Inter-temporal Uncertain Contextual

First mover advantage Strategy formulation

Early warning system Change agent Continuous learning

Customer focus

Public image

INTERNAL ENVIRONMEN T

EXTERNAL ENVIRONMENT

INTERNAL ENVIRONMENT

BUSINESS FIRM

EXTERNAL ENVIRONMEN T

culture Company image and brand equity

Mission and objectives

Human and other resources Top management structure

Power structure

MICRO ENVIRONMENT

MACRO ENVIRONMENT

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CUSTOMERS COMPETITION SUPPLIERS MARKETING INTERMEDIARIES FINANCIERS PUBLICS

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POLITICAL AND LEGAL ENVIRONMENT SOCIAL AND CULTURAL ENVIRONMENT ECONOMIC ENVIRONMENT TECHNOLOGICAL AND PHYSICAL ENVIRONMENT NATURAL ENVIRONMENT GLOBAL ENVIRONMENT

BUFFERING

LEVELLING
ANTICIPATION

RATIONING
DOMINATING

CHANGING