5 ways on how Global Changes Can Affect the Business Environment

1. Growing Urban Population

2. Global Warming

3. Demographic Changes

4. Emerging Markets Gain Power

5. Advances in Technology

Growing Urban Population

The United Nations predicts that urban populations will grow by 72% in 2050.  This growth will mainly happen in African and Asian countries and the rural population will fuel this growth.  In developed countries, current infrastructure will not be enough to keep up with this growth and in emerging economies new cities will form.  Cisco believes that cities will want to use data and cloud technology to help promote efficient city management and communication.  Therefore Cisco is positioning itself for this growth opportunity. 

The article identified two implications as a result of rapid urban growth.  The first implication is that megacities (cities with more than 10 million residents) will have more influence on nations due to their size and constituent voting power.  The second is that as these cities grow there will be a greater demand for resources to build infrastructure, educate residence, provide security and promote employment opportunities.  

Global Warming

Companies have noticed that the climate is changing because of the rise in extreme weather and sea levels.  This change is making it harder for traditional farming and creating a greater demand of resources.  Companies are already thinking about responses to this trend. For example, Coca-Cola sees water scarcity in the future as a threat to its sustainability.  This threat has caused Coca-Cola to initiate an initiative to restore the US watershed by returning water to the National Forest System.  Weather changes and population growth both drive resource scarcity.  The National Intelligence Council predicts that by 2030 we’ll need 50% more energy, 40% more water and 35% more food.  

 Due to these changes we are likely to see an increase in regulation directed towards conservation and sustainability.  We should also see an increase in conflicts around the world as access to resources is decreased.  These changes will make securing resources through collaboration all the more fundamental and we could also see new industries being developed and existing ones transforming.    

Demographic Changes

Populations are growing older in developed countries while other countries are experiencing an increase in their overall growth rate.  This change will affect the labor force making it more difficult for companies to acquire talent in developed countries.  Almost two-thirds of CEOs are concerned that there are not enough skilled laborers to meet demand.  Over 90% of companies are changing the way they attract and retain employees.

The implications of this demographic change are that governments may have to increase taxes in order to care for the elderly and companies may have to revise their business models due to an increase in pension costs.  Workers may also have to improve their skills or learn new ones in order to stay competitive in the job market.  

Emerging Markets Gain Power

Over the past few hundred years, the West has been the economic powerhouse.  Now developing countries, in particular “BRIC” countries, are gaining more influence due to increases in population, exports, and innovation.  As these countries trade and invest within themselves, we are likely to see them grow at a more rapid rate.  India and China could see large increases in their middle classes.  This poses a great opportunity for car manufactures.  Three-fourths of Americans own vehicles while only about 2% in India and 6% in China own at least one vehicle. 

This shift in economic power may create more competition on a global scale while reducing the influence of Western markets.  This could make talent and businesses seek opportunities abroad placing established markets at a disadvantage for growth.  Western governments may notice large companies leaving to settle in emerging markets in order to gain a tax break.  This could cause governments to lower taxes in order to keep large companies from moving abroad.  

Advances in Technology

New technological developments are creating totally new industries.  These breakthroughs have come from advances in nanotechnology, research and development, and mobile technology.  Companies are tackling with these changes by attempting to anticipate how they will affect consumer trends.  For example, Amazon is seeking approval from the FAA to deploy a drone delivery system and Ogranovo is creating 3D livers in a lab.  Both of these advances are different but could equally have a large impact on their industries.  

The implications for advances in technology are that there will be fewer barriers for virtual businesses, thus creating more competition; and the ability to leverage and use this technology will be a necessity instead of just an advantage. 

8 ways on how to achieve competitive advantage in the strategic business environment

1. Uniqueness  - finding unique opportunities and solutions is about imagination, insight, foresight, and the courage to pursue it. Unique is new, different, but most important of all, untested and unproven. By the time a unique solution is validated as profitable, it is no longer unique for the next company. Also, if it is a unique business model or business capability, it is likely unapproachable, in the short-term, by competitors.


2. Strategic Focus - Strategic focus comes about from marrying distinctive competency and purpose to form a superior value proposition. Strategic focus is about developing a longer view of competitive advantage with a combination of purpose, competency, and value proposition.

This creates an internal environment that has the confidence and implicit support to continue to perfect and develop that focus through creating stronger competencies and further perfecting the value proposition.

3. Strategic Intent/Vision/BHAGs - Strategic intent challenges and guides the organization to achieve the achievable by having a clear focus on outlandish objectives which require the development of new capabilities to achieve.


4. Innovation -  Innovation is inventiveness put into profitable practice. In an evolving economy, the business organization must innovate at a rate that meets or exceeds its environment in order to sustain a competitive advantage.


5. Continual Innovation -  Making innovation as an ongoing process on all fronts.


6. Democratic Principles - Democratic principles are needed to fully engage the active participation of diverse thinkers from across the organization. Broad and diverse participation improves innovation.

7. Strategic Management as a self-improving learning process - Strategic management must become, amongst other things, a learning and self-improvement process for the organization.


8. Dynamic Capabilities - Sustainable competitive advantage is ultimately based on dynamic capabilities, the capability to produce and utilize new capabilities on a continuous basis.

18 ways and method on how to communicate in a business environment

Plan communication

1. Identify the purpose of the communication

2. Decide which method of communication to use


Communicate in writing

3. Format information clearly and accurately

4. Use language that suits the purpose of the
communication

5. Use accurate grammar, punctuation and spelling
to make sure meaning is clear

6. Check work and make any necessary
amendments

7. Produce the communication to meet deadlines
recognizing the difference between what is
important and what is urgent

8. Keep a file copy of all communication

Communicate verbally

9. Present information clearly to others

10. Make contributions to discussions

11. Listen actively to information other people are
communicating

12. Ask relevant questions to clarify anything not
understood

After communication

13. Seek feedback on whether the communication
achieved its purpose

14. Reflect on the outcomes of the communication
and identify ways to develop communication
skills further

15. Emails
communication via email remains potent. It will enable you to pass messages to members of your team without pulling them out of their work stations.

16. Use Visuals
Using presentations like Microsoft Power Point to communicate with your team will give them the opportunity to refer back to it if they aren’t clear about certain things.

17 .Simple Words
 to be effective in your communications with your team members, use words that can be easily understood

 18. Visuals
Place visuals at strategic positions around the work stations of your team. They should not just hear the message, they should also see it. This gives room for better comprehension.

6 steps on how to keep waste to a minimum in a business environment

1. Recycle papers 


2. Use mechanical pencils so only the leads needs to be replaced, not the whole pencil


3. Do all paper-cutting in one area, with a recycle can handy beneath it 


4.  Allot the amount of supplies people need for moderate periods of time, like 3 weeks--not too much all at once so it gets wasted







5.  Save Paper and Card
The easiest way to save paper around the office is to cut down on unnecessary usage. Print documents only if absolutely essential, using both sides where possible, and send memos to colleagues by email. Keep reusable scrap paper close to phones for note taking, and resist the urge to write insignificant reminders on Post-it notes where possible


6.  Donate to Charity
  In offices where computers and other electronic equipment must be updated regularly, donating any unwanted items to charity

Four Key Effects of the Political Environment on Business Organizations

1 - Impact on the Economy

The political environment in a country affects its economic environment. The economic environment, in turn, affects the performance of a business organization. In the United States, for instance, there are significant differences in Democratic and Republican policies. This has implications for factors such as taxes and government spending, which in turn affect the country's economy. A higher level of government spending tends to stimulate the economy, for instance.

2 - Changes in Regulation

Governments could change their rules and regulations, and this could have an effect on a business. For instance, after the accounting scandals of the early twenty-first century, the United States Securities and Exchange Commission became more focused on corporate compliance and the government introduced the Sarbanes-Oxley compliance regulations of 2002. This was a response to the social environment that called for such change to make public companies more accountable.


3 - Political Stability

Particularly for businesses that operate internationally, a lack of political stability in any country has an effect on its operations. A hostile takeover could overthrow a government, for instance. This could lead to rioting and looting and general disorder in the environment. All this disrupts the operations of a business. Such disruptions have occurred in Sri Lanka, which went through a protracted civil war, and in Egypt and Syria, which have been subject to disturbances as people agitate for certain rights.

Mitigation of Risk

One way to manage political risk is to buy political risk insurance. Organizations that have international operations use this type of insurance to mitigate their risk exposure as a result of political instability. There are indices that provide an idea of the risk exposure an organization has in certain countries. For instance, an index of economic freedom ranks countries based on how political interference impacts business decisions in each country.