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INTERNAL ENVIRONMENT OF

BUSINESS

Internal Environment of Business


efficient cause of business Cause of business
composed of :
internal forces
human elements
whole corporate structures with
organizational objects: corporate structures
1. Suprastructures - corporate philosophy
- mission, vision, goal, policies and strategies,
organizational culture and climate c
2. Infrastructures corporate bureaucracy,
processes and resources II. Internal
Infrastructures
3. Internal publics human elements
(management and employees/workers) III.
Internal Publics

Efficient Cause of Business


effect is produced of the external factors :
- for the existence of a being
- sustains in its existence
- reasons of being
consist of people, things, conditions for keeping
business going
businessmen, consumers, production, marketing,
management and its resources, and environment
Example of Aristotle: production of a work of art or
craft
sculptor - the efficient cause of sculptures
Internal Environment of Business

Corporate Concept
Corporate
both a structure and specific level of structure
top organizational level of decision-making
Structure
refers to whole organization
Corporate Entity
combination of all structures
corporation or company

Corporate Concept
Corporate decisions involved the 3 factors of
Corporate Endeavor:
corporate policy
corporate goal
corporate strategy
Corporate Endeavor
refer to totality of the life and operations of an
present
organization
status of organization
what is at any given time
starting point of subsequent development
progress toward corporate goal Internal
Environment of Business

I. Internal Suprastructures
i.

Corporate Philosophy
- management thought/companys way of
thinking and directs its way of life
- gives meaning to its existence
- provides ultimate direction of operations
Principles of Corporate Philosophy:
Corporate Vision
- companys aspirations
- what the company wants to be
Corporate Mission
- statement what the company wants to do
- provides direction for the companys goal
- companys commitment to society
- role in development of society and man

I. Internal Suprastructures

Corporate code
- set of standards that guides employees behavior
- Code of Conduct, Code of Ethics, Employees
Manual, Handbook of Discipline
Corporate goal
- what the organization seeks to achieve as an
organization in the pursuit of its mission
- what puts the corporate endeavor into action
- goal could be profitable service or service with
profit
Corporate
policy
- overall direction and basic guidelines for the
corporate strategy
- corporate level in the organizational structure
- provides boundaries and direction of
managerial decisions

I. Internal Suprastructures

Corporate strategy
- principal framework of organizations effort in
pursuing
corporate goal
- totality of all the programs, projects, operations
and undertakings of organization to achieve the
corporate goal
Policy Strategy Framework Slide 10
1. Corporate Level
- Corporate Policy - Corporate Strategy
- Corporate Goal - Corporate Endeavor
2. Major Policy Level
- Program level, program strategy and objectives
- Project level, project strategy and objectives
3. Operating Policy Level
- Activity level

I. Internal Suprastructures

Program Level
- each of the major product of the organization
- with program objective pursued by program
strategy in the light of program policy
Project Level
- division of the program
- with project objective pursued by project
strategy in the light of project policy
Activity Level
- pursue its target in the operations guidelines
- actual production of companys output (goods
or service)

Policy Strategy
Framework

I. Internal Suprastructures

ii. Organizational Culture


Composed of:
. totality of all the organizational objects
. shared or common orientation of members
iii. Organizational Climate
. overall impact of the organizational culture on
the members
. employees interpretation of the organizational
environment/employees perceptions
. Best indicator is the employees morale

II. Internal Infrastructures

Corporate Structures Internal Environment


of Business
Consists of:
Various hierarchical levels
Human resources
Different system and subsystems
- Expresses the superior-subordinate relationship
Corporate Resources
. Human and financial resources
. Material/Technological resources of information,
processes and tools
. Dimensional resources of time and space
. Organizational resources

Resource Cycle
RESOURCES

Invested In

BUSINESS
OPERATIONS
Committed
to

SERVICE
To Yield

RESOURCE
RECOVERY

PROFIT

WEALTH
MAXIMIZATION

III. Internal Publics

Human Resourcestenal Environment of


Business
As subjects:
Organization movers responsible for corporate
dynamism
As objects:
Recipients
of the organizational
objectivesand
Symbiotic
relationship
between management
and rewards (salaries, benefits)
workers
Individual truly works for the organizational goal :
- management achieve their objective
- provide satisfaction of the workers needs
Organization truly works in support of individual
goal:
- individual achieve his objectives
- motivated to work best
Union philosophy could be influence by workers
aspiration or motives of outside forces

THANK

YOU!

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