Challenges of the External Environment Imposed on Managers
Challenges of the External Environment Imposed on Managers
The manager’s job cannot be accomplished in a vacuum within the organization. Many interacting external factors can affect managerial performance. The external environment consists of factors that affect a firm from outside its organizational boundaries. The external factors include the labor force, legal, political, legal considerations, society, unions, the competition, customers/suppliers, and technology. One of the greatest challenges facing all organizations today is managing uncertainty. Managers must do what they can to reduce uncertainty by reading the signals, following the trends, and scanning the external environment. The way in which trends in each of these areas affect the workplace is discussed later in this paper.
Labor force
The capabilities of a firm’s employees determine to a large extent how well the organization can perform its mission. Since new employees are hired from outside the firm, the labor force is considered an external environment factor. The labor force is always changing. This inevitably causes changes in the workforce of an organization thus affecting the way management must deal with its workforce. (Mondy 1995, p.36) Changes in the country’s labor force create dynamic situations within organization. For example, changing values and laws have contributed to greater participation rates by women in the employment market thus parental leave and child-care facilities provided by employers are becoming more common demands.
Legal Considerations
Law is important in business transactions. It provided a basic framework within which a business enterprise must operate. It facilitates smooth functioning of business transactions and protects both the businessmen and customers. All business organizations must comply also with the legal constraints of that country. In turn when a firm’s operations extend into other countries, the laws and regulations of those countries must be taken into account. (Mondy 1995, p.36)
Society
Members of society may also exert pressure on management. The public no longer accepts the actions of business organizations without questions. People learned that voicing out their disagreements in newspapers and other forms of media can produce changes. The large number of laws and policies passed in recent years is the result of the publics¡¦ influence. An organization in order to remain acceptable to the general public must accomplish its mission within the range of societal norms and remain in societal good books. When a firm responds effectively to societal interests, it is said to be socially responsible. Social responsibility is the...