Environment The major internal factors affecting business decisions are i Values system: The values of the founder/ owner of the business , percolates down to the entire organisation and has a profound effect on the organisation. The success of an organisation depends upon the sharing of value system by all members. External business associates like suppliers and distributors consider the value system practised by an organisation with strong culture of ethical standards and values. ii.
Vision and objectives: The vision and objectives of a business guides its operations and strategic decisions. Example ‘Amul the taste of India’ Gujarat Co-operative Milk Marketing Federation GCMMF Vision: Liberate our farmers from economic oppression and lead them to prosperity. iii. Management structure and nature: The structure of management/board and their style of functioning, the level of professionalism of management, the composition of the board are the various factors which affects the decision making.
Since the board is the highest decision making authority, it’s composition, degree of professionalism and style of operations plays a very critical role in the growth and development in an organisation. iv. Internal power relations: This refers to the internal power relations that exist in an organisation. The relations among board members , between board members and the CEO and the level of support enjoyed by the board from its’ stakeholders namely employees and shareholders are significant factors which affects decision making and its implementation in an organisation.
v. Human resources: The success of an enterprise is solely dependent on its manpower. Therefore the quality, skill competency, right attitude and commitment of its human resources is essential for the success of an organisation. vi.
Company image: The image of an organisation plays an important role in introducing new products, selecting agents and dealers for distribution, forging alliances with suppliers, expanding and entering new markets both domestic and international, raising finance etc. vii. Other factors: The firm’s ability to innovate reflected by its research and development, the strength of its financial position and the capital structure, the efficiency in managing the marketing and distribution network ,and the physical resources like plant, building technology are the other major factors on which affects the success of a business. Two Indian companies TATA Steel and WIPRO have been named as the world’s most ethical companies by American Think tank Ethisphere Institute.
Infosys, Murugappa group, TVS group 12th Commerce Unit - - . . PM