Global Organizations and Task Environment

• A global organization operates and competes in more than one country, examples include Coke, Google, and Apple.
• Operating globally can be unpredictable, but offers opportunities in new markets, technologies, and lower raw material costs, while threats from new competitors also exist.
• The global environment consists of external forces/conditions that affect an organization's operations and behavior.

Task Environment and Forces

• The task environment includes forces and conditions originating with suppliers, distributors, customers, and competitors.
• It affects an organization's ability to obtain inputs and dispose of outputs, influencing managers daily.
• These forces have the most immediate and direct impact on managers.

Suppliers

• Suppliers provide resources for goods and services through outsourcing.
• Managers ensure a reliable supply of input resources.
  • Suppliers being the sole source of input or the input being vital to the organization are challenges. Increasing opportunities from many suppliers for a particular input including outsourcing can lower costs.

Distributors

• Distributors help organizations sell goods or services to customers.
• More channels to sell products creates opportunities.
• Distributor control over customers can lead to high costs, acting as a threat.

Customers

• Customers are those who buy goods and services
• Opportunities arise with new customers.
• Threats involve identifying and satisfying customer needs.

Competitors

• Competitors are organizations offering similar goods and services.
  • More competitors and potential competitors are threats, reducing profit with barriers to entry.

General Environment and Forces

• The general environment encompasses a wide range of global, economic, technological, sociocultural, demographic, political, and legal forces.
• These forces affect both an organization and its task environment.

Economic Forces

• Economic forces include interest rates, inflation, unemployment, economic growth, and other factors.
• They affect the general health and well-being of a nation's or region's economy.

Technological Forces

• Technological forces are outcomes of changes in design, production, and distribution technologies.

Sociocultural Forces

• Sociocultural forces are pressures from a country or society's social structure or national culture. Social structure involves traditional systems between people and groups in society and national culture involves values important to society's norms.

Demographic Forces

• Demographic forces are outcomes of changes in population characteristics or attitudes, like age, gender, ethnic origin, race, sexual orientation, and social class.

Political and Legal Forces

• Political and legal forces are outcomes of changes in laws and regulations.
• These include industry regulations, organizational realization, and increased emphasis on environmental protection.

Globalization

• Globalization integrates and connects economic, political, and social systems across countries, cultures, and regions, making nations increasingly interdependent and similar.
• Globalization is shaped by the ebb and flow of capital, seeking the greatest returns or profits across companies, countries, and regions.

Four Principal Forms of Capital

• Human capital is the flow of people worldwide through immigration, migration, and emigration.
• Financial capital is the flow of money across world markets through overseas investments, credit, lending, and aid.
• Resource capital is the flow of natural resources, parts, and components between companies and countries.
• Political capital is the flow of power and influence using diplomacy, persuasion, aggression, and force to protect rights or access.

Factors Increasing Capital Flows

• Declining barriers to trade and investment, including tariffs, increase capital flow.
• Declining barriers of distance and culture also promote capital flows.

Hofstede’s Model of National Culture

• This model helps to understand cross-cultural differences.

Power Distance

• This refers to the degree to which less powerful members of an organization accept unequal power distribution.

Achievement orientation

• This relates to the importance placed on achievement and competition.

Individualism/Collectivism

• Individualism/collectivism involves expectations regarding self-reliance versus integration into groups.