Identify at least four forces in the general environment of organizations and provide an example of each for an industry or business. How do these forces differ from the external stakeholders in the task environment?

Question

What will be an ideal response?

Answer 1

The general environment forces are economic, technological, sociocultural, demographic, political-legal, and international.

Economic forces consist of the general economic conditions and trends—unemployment, inflation, interest rates, economic growth—that may affect an organization’s performance.

Technological forces are new developments in methods for transforming resources into goods or services. For example, biotechnology may well turn health and medicine upside down in the coming decades.

Sociocultural forces are influences and trends originating in a country’s, a society’s, or a culture’s human relationships and values that may affect an organization. The interest in health and fitness, for instance, led to a decline in sales of cigarettes, whiskey, red meat, and eggs.

Demographic forces are influences on an organization arising from changes in the characteristics of a population, such as age, gender, or ethnic origin. The birthrate is up for all racial and ethnic groups, but the increase for Hispanics is the largest.

Political-legal forces are changes in the way politics shape laws and laws shape the opportunities for and threats to an organization. In the United States, whatever political view tends to be dominant at the moment may be reflected in how the government handles antitrust issues, in which one company tends to monopolize a particular industry.

International forces are changes in the economic, political, legal, and technological global system that may affect an organization. For example, economic integration of the European Union is creating threats and opportunities for American companies.

These forces differ from external stakeholders in the task environment because an organization may be able to influence or control elements in its task environment, but rarely in its general environment.