Question

Explain the following points of importance of business environment: (i) Helps in tapping useful resources (ii) Helps in coping with rapid changes.

Hint:

The environment is like a "Supply Store" (Resources) and a "Weather Report" (Changes) for a business.

Answer 1

Step 1: Understanding the Concept:
Business environment scanning is crucial for managers to align their organizational goals with the external world.
Step 2: Detailed Explanation:
1. Tapping Useful Resources: Business depends on the environment for inputs like finance, machines, raw materials, power, and water. A firm scans the environment to ensure it can convert these resources into outputs that the environment desires.
2. Coping with Rapid Changes: Today’s business environment is highly dynamic. Turbulent market conditions and rapid technological shifts require managers to scan the environment constantly to develop suitable courses of action to deal with these changes.
Step 3: Final Answer:
Scanning the environment ensures a steady supply of inputs and helps the firm adapt to volatile market conditions.