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1.0 THE CONCEPT OF BUSINESS IN CONTEXT

1.0 THE CONCEPT OF BUSINESS IN CONTEXT. What is business? The ‘Business in Context’ model The contexts of business How the model works The systems and contingency approaches. 1.1 WHAT IS BUSINESS?. An organized effort to produce goods and services to meet the needs of society

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1.0 THE CONCEPT OF BUSINESS IN CONTEXT

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  1. 1.0 THE CONCEPT OF BUSINESS IN CONTEXT What is business? The ‘Business in Context’ model The contexts of business How the model works The systems and contingency approaches

  2. 1.1 WHAT IS BUSINESS? • An organized effort to produce goods and services to meet the needs of society • A broad concept - manufacturing and service industry, not for profit organizations, voluntary sector and public services • The growth of the ‘business model’ in which all organizations are run as businesses

  3. 1.2 THE BUSINESS IN CONTEXT MODEL

  4. 1.3 THE BUSINESS IN CONTEXT MODEL II • Business can best be understood as a series of related activities in a number of different contexts • These contexts can be seen as levels and comprise: - Activities or functional level - Strategic level - Organizational level - Environmental level

  5. 1.4 BUSINESS ACTIVITIES OR FUNCTIONS • Innovation • Operations • Marketing • Human resource management • Finance and accounting

  6. 1.5 THE STRATEGIC CONTEXT • The nature of management and leadership • The formulation of a set of objectives and the means of achieving those objectives • Issues of ethics and corporate social responsibility

  7. 1.6 THE ORGANIZATIONAL CONTEXT • Goals • Structure • Ownership • Size • Organizational/corporate culture

  8. 1.7 THE ENVIRONMENTAL CONTEXT • Globalization – an overriding factor • The economy • The state • Technology • Labour • Culture

  9. 1.8 KEY ASPECTS OF THE BUSINESS IN CONTEXT MODEL • Businesses are a complex network of interrelationships • Business activities are both influenced by and in turn influence the strategic, organizational and environmental contexts in which they operate • Interaction occurs within each level of the model as well as between levels • Decisions that affect one part of the business will impact on other parts as well • Decisions are made by people with all the subjectivity that entails • Interactions are influenced by history

  10. 1.9 KEY ASPECTS OF THE BUSINESS IN CONTEXT MODEL II • Interactions and influences operate within each context between the various elements. • Interactions and influences operate between elements at different levels. • Influences operate in every direction

  11. 1.10 THE SYSTEMS APPROACH I • All organizations are made up of interdependent parts • Organizations may be viewed as a series of inputs, processes and outputs (see slide 1.11) • The job of management is to balance the inputs, processes and outputs • Equilibrium between the organization and its environment is important • Feedback is an important element of the system - from the outputs to the processes and the inputs and from the processes to the inputs

  12. 1.11 THE SYSTEMS APPROACH II

  13. 1.12 THE CONTINGENCY APPROACH • Organizations and their activities are shaped by the environments in which they operate • Organizations should adapt to the prevailing environment • Most successful organizations have a ‘best fit’ with their environment • Organizations that do not adapt will fail

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