Introduction to Business

Meaning and Definition of Business

Business refers to a complex system of organized activities aimed at producing, distributing, and exchanging goods and services to satisfy human needs and wants. It encompasses a wide range of economic and non-economic activities undertaken by individuals, organizations, or entities with the primary goal of generating profit. In simple terms, business refers to state of being busy.

While business activities involve the production, buying, selling, and exchange of goods and services, they also extend beyond the economic realm to include various non-economic aspects, such as social interactions, cultural contributions, and employment creation. These activities are driven by the profit motive and involve careful planning, resource allocation, risk management, innovation, and adaptation to the ever-evolving dynamics of markets and environments.

As a fundamental component of society, business plays a pivotal role in driving economic growth, creating value, and shaping the way individuals and communities interact with products, services, and each other.

Milton Friedman, a renowned economist and Nobel laureate, defined business as, “The business of business is business.” In this concise statement, Friedman emphasizes that the primary objective of businesses is to maximize profits and create value for their shareholders.

According to Peter Drucker, “Business means to create and retain a customer.”

Human Activity

A. Economic Activities

Economic activities refer to actions that involve the production, distribution, and consumption of goods and services with the primary aim of earning income or generating economic value. These activities contribute to the economic growth and development of a country. Economic activities can be further divided into three main categories:

Primary Economic Activities: These are activities that involve the direct extraction of natural resources from the environment. Examples include agriculture, forestry, fishing, mining, and hunting. Primary activities are often the foundation of many economies, especially in developing countries.
Secondary Economic Activities: Secondary activities involve the processing and transformation of raw materials obtained from primary activities into finished goods. Manufacturing, construction, and industrial activities fall under this category. Secondary activities add value to raw materials and create more diverse products.
Tertiary Economic Activities: Tertiary activities are service-oriented and involve providing various services to individuals, businesses, and communities. This sector includes professions like healthcare, education, transportation, retail, finance, entertainment, and tourism. Tertiary activities are becoming increasingly significant in modern economies.

B. Non-Economic Activities

Non-economic activities are actions that are not primarily driven by the desire to earn income or create economic value. These activities are often driven by personal, social, cultural, or altruistic motives. Non-economic activities are not directly tied to the production and distribution of goods and services for market transactions. They can be categorized into the following types:

Social Activities: These activities are centered around building and maintaining relationships, fostering social connections, and promoting community well-being. Examples include spending time with family and friends, attending social gatherings, and participating in community service.
Cultural and Recreational Activities: Engaging in cultural pursuits like art, music, literature, and sports falls under this category. These activities contribute to personal development, cultural enrichment, and leisure.
Educational Activities: Pursuing education, whether formal or informal, is a non-economic activity aimed at personal growth, skill enhancement, and knowledge acquisition. Educational activities can include attending schools, colleges, and workshops.
Religious and Spiritual Activities: Participating in religious rituals, ceremonies, and spiritual practices are non-economic activities that hold personal and spiritual significance.
Household Activities: Household chores, caring for family members, and maintaining one’s living space are essential non-economic activities that contribute to daily life but may not involve monetary transactions.

Differences between Economic and Non-Economic Activity

Aspect	Economic Activities	Non-Economic Activities
Objective	Earn income or generate economic value	Driven by personal, social, cultural, or altruistic motives
Focus	Production, distribution, and consumption of goods and services	Building relationships, personal growth, cultural enrichment, leisure, and more
Nature	Market-oriented; involve transactions and economic exchange	May not involve monetary transactions; often personal or communal
Categories	Primary, secondary, and tertiary activities	Social, cultural, recreational, educational, religious, household activities, and more
Examples	Farming, manufacturing, retail, banking, transportation, tourism	Social gatherings, art, sports, attending workshops, religious rituals, household tasks
Monetary Motivation	Central; earnings and economic gain are primary motivations	Secondary or even absent; focus is on non-monetary rewards
Impact on Economy	Directly contribute to GDP and economic growth	May not have direct economic impact, but contribute to overall well-being and culture
Resource Utilization	Often involves utilization of resources such as land, labor, and capital	Resource utilization is based on personal, social, or cultural needs
Examples of Sectors	Agriculture, manufacturing, services like banking, healthcare, retail	Art, music, community service, religious practices, education, personal relationships
Motivation for Choice	Earning a livelihood, achieving economic goals, improving living standards	Personal growth, cultural preservation, contributing to society

How is business an Important Human Activity?

Business is a critically important human activity that plays a pivotal role in shaping economies, societies, and individual lives. Its significance stems from a variety of factors that collectively contribute to economic growth, job creation, innovation, and the overall well-being of societies. Here are several reasons why business is considered an important human activity:

Economic Growth: Business activities, particularly in the form of production, distribution, and trade of goods and services, contribute significantly to the economic growth of nations. Businesses drive economic expansion by generating revenue, creating jobs, and contributing to a country’s gross domestic product (GDP).
Job Creation: Businesses are major sources of employment. They provide job opportunities for a wide range of skill sets and educational backgrounds, contributing to reducing unemployment rates and improving the standard of living for individuals and families.
Innovation and Technology: Businesses are engines of innovation. They drive technological advancements and improvements in products, processes, and services. This leads to increased efficiency, enhanced quality, and the development of new solutions that benefit society.
Wealth Generation: Successful businesses generate profits, which, in turn, can be reinvested for growth or distributed among shareholders. This cycle of wealth generation contributes to individual prosperity and the accumulation of capital within an economy.
Trade and Exchange: Businesses facilitate trade both domestically and internationally. They enable the exchange of goods and services across regions and countries, fostering economic interconnectedness and enabling access to a diverse range of products.
Tax Revenue: Businesses contribute to government revenue through various forms of taxation, including corporate taxes, sales taxes, and import duties. This revenue supports public services, infrastructure development, and social programs.
Consumer Satisfaction: Businesses aim to meet the needs and desires of consumers by providing products and services that enhance their quality of life. Competition among businesses encourages the delivery of higher-quality products at competitive prices.
Entrepreneurship: Business activities encourage entrepreneurship, which is essential for creating new ventures, exploring uncharted markets, and bringing novel ideas to fruition. Entrepreneurs often drive economic dynamism and job creation.
Economic Stability: A robust business environment contributes to economic stability by diversifying income sources and reducing dependence on specific sectors. A diverse range of businesses can help buffer against economic downturns.

Characteristics/ Features of Business

Profit Motive: One of the primary characteristics of business is the profit motive. Businesses are established with the intention of generating profits by producing and selling goods or services. The pursuit of profit serves as a driving force for business activities, including cost management, pricing strategies, and resource allocation.
Exchange of Goods and Services: Business involves the exchange of goods and services for monetary value. Businesses produce or acquire products and services that meet the needs and desires of consumers, and these offerings are traded in the marketplace.
Risk and Uncertainty: Business activities are inherently associated with risks and uncertainties. Business owners must make decisions while dealing with factors like market fluctuations, changing consumer preferences, competition, and economic conditions. The ability to manage and mitigate risks is crucial for business success.
Legal Entity: A business is often registered as a legal entity, separate from its owners. This separation provides businesses with distinct legal rights and responsibilities. This legal status allows businesses to enter into contracts, own property, and engage in transactions.
Continuous Process: Business is a continuous and ongoing process. It involves a series of interconnected activities, such as production, marketing, sales, and customer service, that must be managed and coordinated over time to achieve sustainable success.
Customer Focus: Businesses are customer-centric. Meeting customer needs and preferences is essential for attracting and retaining customers. Businesses must adapt to changing consumer demands and deliver value to maintain customer loyalty.
Profit and Loss: Businesses operate in an environment where profitability varies. They experience periods of profit and loss due to factors like market conditions, competition, and economic fluctuations. The ability to manage costs, maximize revenue, and adapt to changing circumstances is crucial to navigate these ups and downs.

Difference Between Human Activity and Business Activity

Aspect	Human Activity	Business Activity
Scope	Broad (personal, social, cultural, altruistic/ not selfish)	Narrow (economic transactions for profit)
Motivation	Personal fulfillment, social interaction, cultural preservation, altruism	Profit motive, financial gain
Goals	Varied (well-being, social connections, cultural enrichment)	Economic value creation, profit generation
Monetary Transactions	Not necessarily involving monetary transactions	Involves monetary transactions, economic exchange
Sectors	Diverse (arts, sports, education, healthcare, etc.)	Specific sectors (agriculture, manufacturing, services, etc.)
Emphasis	Individual well-being, cultural/social aspects	Profitability, financial success
Cultural/Social Impact	Contributes to cultural preservation, social cohesion	Contributes to economic growth, job creation, innovation

Dimensions/ Scopes of Business

A. Industry

Industry refers to specific sectors of economic activity that involve the production, manufacturing, and processing of tangible goods. It encompasses businesses engaged in similar or related activities, creating products that can range from automobiles to electronics. Industries form the backbone of economies, contributing significantly to GDP, employment, and technological advancement. They involve complex supply chains and play a significant role in shaping the industrial landscape of a country. In simple terms, industry is defined as a group of firms or manufacturers that produce homogeneous commodities.

According to Company Act 2063 B.S, “Industry means any company incorporated under this act.”

According to Macro Economics, “An Industry is a branch of an economy that produces a closely related set of raw materials, goods or services.”

Types of Industries

a. Genetic Industries: Genetic industries involve activities related to the breeding, cultivation, and improvement of plants and animals. These industries focus on enhancing the genetic traits of organisms for specific purposes, such as improved crop yield, disease resistance, and desirable characteristics in livestock. Genetic industries play a significant role in agriculture and biotechnology, contributing to advancements in food production and sustainability.

Examples: Seed companies that develop genetically modified crops, animal breeding farms that produce high-yield livestock, and biotechnology firms involved in genetic engineering.

b. Extraction Industries: Extraction industries involve the extraction and utilization of natural resources from the Earth’s surface or subsurface. These industries encompass activities such as mining, drilling, and harvesting raw materials like minerals, oil, gas, and timber. Extraction industries provide essential resources for manufacturing, construction, and energy production.

Examples: Mining companies extracting minerals like coal, iron ore, and gold; oil and gas companies engaged in drilling and exploration; logging companies harvesting timber.

c. Construction Industries: Construction industries are involved in the creation of physical infrastructure, buildings, and structures. These industries encompass the planning, design, and execution of projects ranging from residential housing to commercial complexes and public infrastructure like roads and bridges.

Examples: Construction companies building residential housing developments, commercial buildings, airports, highways, and infrastructure projects.

d. Manufacturing Industries: Manufacturing industries involve the transformation of raw materials or components into finished products through various processes. These industries produce a wide range of goods, from consumer products to industrial equipment, by adding value through processing, assembly, and quality control.

Examples: Automobile manufacturing plants producing cars, electronics factories assembling smartphones and computers, textile mills producing fabrics, and food processing facilities.

e. Synthetic Industries: Synthetic industries focus on creating artificial or synthetic materials through chemical processes. These industries involve the synthesis of substances that do not occur naturally, often to replace or enhance existing materials.

Examples: Chemical companies producing synthetic polymers (plastics), pharmaceutical companies developing synthetic drugs, and textile manufacturers producing synthetic fabrics like nylon.

f. Assembling Industries: Assembling industries involve the process of putting together various components or parts to create finished products. These industries often rely on efficient assembly lines and specialized techniques to produce goods.

Examples: Electronics assembly plants putting together electronic devices like smartphones and laptops, automobile assembly lines manufacturing cars from various components, and toy manufacturers assembling toys from parts.

B. Commerce

Commerce encompasses the intricate network of buying and selling activities that facilitate the movement of goods and services from producers to consumers. It involves trade, both domestic and international, and includes distribution channels like wholesalers, retailers, and online marketplaces. Commerce also involves financial transactions, logistics, and services that enable the smooth flow of goods through the market. It’s a vital driver of economic growth, creating business opportunities and expanding markets.

According to L.H Haney, “Commerce includes all those activities which are necessary for maintaining the free flow of goods and services from the producers to the ultimate consumers.”

In the words of James Stephenson, “Commerce is that part of business which is concerned with the exchange of goods and services and includes all those activities which directly or indirectly facilitate that exchange.”

Types of Commerce

a. Trade

b. Auxiliaries of Trade

a. Trade: Trade refers to the exchange of goods and services between individuals, businesses, or entities. It plays a pivotal role in the movement of products from producers to consumers. Trade can be categorized into home trade and foreign trade.

i) Home Trade: Home trade involves the buying and selling of goods and services within the boundaries of a single country. It’s further divided into wholesale trade and retail trade.

Wholesale Trade: Wholesale trade involves the sale of goods in large quantities to retailers, institutions, or other businesses. Wholesalers act as intermediaries between manufacturers and retailers, providing bulk quantities at discounted prices. For example, a grocery store purchasing snacks in bulk from a wholesaler to stock its shelves.
Retail Trade: Retail trade involves the sale of goods to individual consumers in smaller quantities. Retailers operate in various formats, such as physical stores, e-commerce platforms, and online marketplaces. Consumers purchase products directly from retailers for personal use. An example is a clothing store selling apparel to individual customers.

ii) Foreign Trade: Foreign trade, also known as international trade, involves the exchange of goods and services across international borders. It includes export trade, import trade, and entry-port trade.

Export Trade: Export trade refers to the sale of domestically produced goods to foreign markets. It allows countries to earn foreign exchange and promotes economic growth. For example, a car manufacturer exporting vehicles to other countries.
Import Trade: Import trade involves the purchase of goods and services from foreign markets for domestic consumption. It allows access to products that may not be produced domestically. An example is a smartphone company importing components from various countries to assemble phones domestically.
Entry-Port Trade: Entry-port trade refers to the trade that takes place at international entry points such as ports, airports, and border checkpoints. These are key hubs where imports are received and exports are sent out. For instance, a shipping port handling imports of raw materials and exports of finished goods.

b. Auxiliaries of Trade: Auxiliaries of trade are services that facilitate and support trade activities, ensuring the smooth flow of goods, information, and financial transactions.

Transportation: Transportation involves the movement of goods from one location to another. Modes of transportation include road, rail, air, and sea. For example, shipping companies transporting goods via cargo ships from one country to another.
Communication: Communication services facilitate the exchange of information between parties involved in trade. This includes electronic communication, telecommunication, and internet services. For instance, email communication between a buyer and a supplier regarding order details.
Banking: Banking services encompass financial transactions, currency exchange, letters of credit, and financing for trade operations. Banks play a vital role in providing financial support to traders. For example, a bank issuing a letter of credit to guarantee payment to an exporter upon delivery of goods.
Insurance: Insurance services provide coverage against risks associated with trade, such as loss or damage to goods during transit. Trade insurance ensures that businesses are protected against unforeseen events. An example is cargo insurance covering goods in case of accidents or theft during transportation.
Warehousing: Warehousing involves the storage of goods before they are distributed to consumers. Warehouses provide a secure location for inventory management. For example, a distribution center storing products before they are shipped to retail stores.
Promotion: Promotion services include marketing and advertising activities that create awareness about products and attract customers. Promotion plays a crucial role in driving demand for goods and services. An example is a company running an advertising campaign to promote a new product to consumers.

Each aspect of commerce, whether trade or its auxiliaries, contributes to the efficient movement of goods, services, and information, supporting economic activity and growth on both domestic and international scales.

C. Service Enterprises

Service enterprises are businesses that offer intangible services to meet specific needs and demands of clients or customers. These businesses don’t produce physical goods but instead provide expertise, assistance, or experiences. Service enterprises can be found in various sectors such as healthcare, education, hospitality, and professional services. Their success relies on the skills and knowledge of their employees, delivering customer-centric experiences, and adapting to evolving customer expectations.

According to renowned business author Philip Kotler, “Service enterprises are defined as businesses that focus on delivering intangible benefits to customers, often involving expertise, advice, or assistance.”

Scopes of Service Enterprises

Education Institutions: Education service enterprises encompass schools, colleges, universities, and training centers that provide educational programs and courses to students. These institutions offer a range of academic and vocational programs aimed at developing knowledge, skills, and personal growth. They play a crucial role in shaping individuals’ intellectual and professional development. Examples include elementary schools providing primary education, universities offering degree programs, and vocational training centers specializing in specific skills.
Hotels and Hospitality Industry: Hotels and hospitality service enterprises provide accommodation, dining, and entertainment services to travelers and guests. They offer a range of amenities, such as rooms, restaurants, spas, and recreational facilities, to ensure a comfortable stay. The hospitality industry contributes to tourism and plays a vital role in enhancing visitors’ experiences. Examples include luxury hotels, boutique inns, and resorts that cater to various traveler preferences.
Cable Network and Broadcasting Services: Cable network and broadcasting service enterprises provide television, radio, and digital media content to audiences. They create and distribute a wide range of programming, including news, entertainment, sports, and educational content. These services contribute to information dissemination and entertainment for viewers. Examples include cable TV providers offering diverse channel options, streaming platforms delivering on-demand content, and radio stations broadcasting news and music.
Internet Service Providers (ISPs): Internet service providers offer connectivity and access to the internet for individuals and businesses. They play a critical role in enabling online communication, information access, and digital activities. ISPs provide various plans, such as broadband, fiber-optic, and wireless connections, catering to different user needs. Examples include local ISPs offering home internet packages and telecommunications companies providing high-speed connectivity options.
Travel and Tour Companies: Travel and tour service enterprises organize and facilitate travel experiences for individuals and groups. They offer various travel packages, itineraries, and services to help travelers explore new destinations and enjoy cultural experiences. These companies handle logistics, accommodations, transportation, and guided tours. Examples include travel agencies offering customized vacation packages, adventure tour companies organizing outdoor expeditions, and cruise lines providing all-inclusive journeys.
Hospitals and Healthcare Services: Hospitals and healthcare service enterprises offer medical care, diagnosis, treatment, and preventive services to individuals seeking medical attention. They encompass a range of facilities, from general hospitals to specialized clinics, catering to various healthcare needs. Hospitals provide a vital role in maintaining public health and treating illnesses. Examples include general hospitals offering comprehensive medical services, specialty clinics focusing on specific medical fields, and urgent care centers providing immediate medical attention.

Objectives of Business

A. Economic Objectives of Business:

Economic Gain: One of the primary economic objectives of business is to generate profits and achieve financial success. Businesses aim to earn revenue that exceeds their costs, leading to positive returns for owners and shareholders. Profitability allows businesses to reinvest, expand, and sustain operations while providing a return on invested capital.
Innovation: Innovation is a crucial economic objective for businesses. It involves developing new products, services, processes, or technologies that meet evolving customer needs and create a competitive edge. Innovation can lead to increased market demand, differentiation, and improved efficiency.
Productivity: Businesses strive to enhance productivity, which involves maximizing output while minimizing input. Improved productivity leads to efficient resource utilization, cost savings, and increased competitiveness. This objective contributes to overall economic growth and profitability.
Increase Market Share: Expanding market share is an economic objective aimed at capturing a larger portion of the target market. Businesses seek to increase their customer base and outperform competitors to gain a stronger foothold in the industry. Higher market share often leads to increased sales and revenue.

B. Social Objectives of Business:

Timely Supply of Goods: Social objectives of business include providing goods and services to meet the needs of consumers in a timely manner. Ensuring a consistent and reliable supply of products helps maintain consumer satisfaction and builds trust.
Supply of Quality Goods: Businesses also have a social responsibility to provide high-quality goods that meet or exceed consumer expectations. Supplying quality products contributes to customer loyalty, positive brand reputation, and long-term success.
Employment Creation: A significant social objective is the creation of job opportunities within the community. By employing individuals, businesses contribute to reducing unemployment, improving living standards, and promoting economic stability.
Supply of Goods in Proper Price: Businesses have a responsibility to offer goods at fair and reasonable prices. Providing goods at proper prices ensures accessibility for a broader range of consumers and helps prevent price exploitation.

C. Human Objectives of Business:

Personal Fulfillment: One of the core human objectives is personal fulfillment and self-actualization. Individuals seek to achieve their potential, pursue their passions, and lead a fulfilling life. Personal fulfillment encompasses realizing one’s dreams, passions, and goals to experience a sense of satisfaction and contentment.
Social Interaction: Human beings are inherently social creatures, and a fundamental human objective is to establish and maintain meaningful social connections. People seek companionship, friendship, and emotional support from family, friends, and communities. Social interactions contribute to well-being and a sense of belonging.
Health and Well-being: Health is a primary human objective, as individuals aspire to maintain physical, mental, and emotional well-being. Leading a healthy lifestyle, staying active, and managing stress are common objectives that contribute to a higher quality of life and longevity.
Personal Development: Human objectives include continuous personal growth and self-improvement. People seek opportunities for learning, skill development, and expanding their knowledge. Personal development contributes to increased self-confidence, adaptability, and the ability to navigate life’s challenges.

D. National Objectives of Business:

Economic Growth and Development: A central national objective is to achieve sustained economic growth and development. Nations aim to increase their gross domestic product (GDP), create job opportunities, and improve the standard of living for their citizens. Economic growth drives prosperity and funds social programs.
Social Equity and Welfare: National objectives include promoting social equity, reducing poverty, and ensuring access to basic necessities for all citizens. Governments strive to provide healthcare, education, housing, and social safety nets to ensure a decent standard of living for everyone.
Infrastructure Development: Another national objective is the development of infrastructure to support economic activities and enhance quality of life. Investments in transportation, communication networks, energy, and public facilities contribute to economic productivity and citizen convenience.
Environmental Sustainability: Ensuring environmental sustainability is a critical national objective in the face of global challenges like climate change and resource depletion. Governments work toward implementing policies to protect natural resources, reduce pollution, and promote eco-friendly practices for present and future generations.

Functions of Business

Production: Production is the process of transforming raw materials or inputs into finished goods or services. It involves various activities such as manufacturing, assembling, processing, and creating tangible or intangible products. The production function ensures that goods and services are created efficiently and meet quality standards, ultimately fulfilling consumer needs and demands.
Distribution: Distribution involves the movement of goods and services from producers to consumers. This function encompasses activities like transportation, warehousing, inventory management, and order fulfillment. Distribution ensures that products are available at the right place, at the right time, and in the desired quantity, making them accessible to consumers.
Investment: Investment is the allocation of financial resources to acquire assets or participate in projects with the expectation of generating future returns. Businesses invest in various areas such as technology, research and development, infrastructure, and expansion. Investment decisions are critical for business growth, innovation, and competitiveness.
Organizing: Organizing is the process of arranging resources, tasks, and activities to achieve business goals efficiently and effectively. It involves creating a structure, defining roles and responsibilities, and establishing communication channels within the organization. Organizing ensures coordination and optimal use of resources to enhance productivity.
Employment Creation: Employment creation is a vital function of business that involves hiring and providing job opportunities to individuals within the organization. Businesses contribute to reducing unemployment rates by offering employment, which leads to economic stability, improved living standards, and enhanced individual skills and development.
Human Resource Management: Human resource management (HRM) involves managing the workforce to maximize their productivity and contribution to the organization. This function includes tasks such as recruitment, training, performance evaluation, employee relations, and compensation. Effective HRM ensures a skilled, motivated, and engaged workforce, fostering a positive work environment.

Business Environment

Business environment refers to the external and internal factors that influence the operations, decisions, and strategies of a business. It encompasses a wide range of conditions, forces, and elements that shape the context in which a business operates. The business environment is dynamic and constantly evolving, impacting various aspects of a business’s functioning, growth, and sustainability.

According to Robbins and Coulter, “Business Environment refers to institutions or forces that affect the organizations performance.”

In the words of Keith Davis, “Business Environment is the aggregate of all conditions, events, and influences that surround and affect it.”

Types of Business Environment

The business environment can be categorized into three main components:

External Environment: This includes factors that are beyond the control of the business but have a significant impact on its operations. The external environment is further divided into the following categories:
- Economic Environment: Economic conditions, such as inflation rates, exchange rates, economic growth, and consumer purchasing power, affect business profitability and demand for goods and services.
- Social and Cultural Environment: Societal values, beliefs, trends, demographics, and cultural norms influence consumer preferences, behavior, and market trends.
- Political and Legal Environment: Government policies, regulations, laws, and political stability impact business operations, trade, taxation, and overall business environment.
- Technological Environment: Technological advancements, innovations, and disruptions influence product development, manufacturing processes, marketing strategies, and competitive advantages.
- Environmental and Natural Factors: Concerns related to environmental sustainability, climate change, and resource availability affect business practices, especially in industries with significant environmental impact.
- Competitive Environment: The actions and strategies of competitors in the market influence business positioning, pricing, marketing, and overall market share.
Internal Environment: This includes factors that are within the control of the business and directly influence its operations and decisions. The internal environment encompasses elements such as:
- Organizational Culture: The values, beliefs, and norms within the organization influence employee behavior, decision-making, and overall performance.
- Management Structure: The hierarchy, roles, and responsibilities within the organization impact communication, decision-making processes, and coordination.
- Resources and Capabilities: The availability and utilization of resources such as human resources, financial capital, technology, and infrastructure contribute to the business’s competitive advantage.
- Leadership and Strategy: The leadership style and strategic decisions of top management influence the direction and long-term goals of the business.
- Corporate Governance: The framework of rules, practices, and processes that guide the actions and behavior of the business and its stakeholders.
- Internal Policies and Procedures: The internal rules, policies, and procedures govern how the business operates and interacts with its employees, customers, and partners.
Global Environment: The global environment in the context of business refers to the factors and conditions that exist beyond national borders and have a significant impact on businesses operating in an interconnected global marketplace. The global environment encompasses a wide range of economic, political, social, technological, and cultural forces that influence international trade, investment, and business operations. Understanding the global environment is essential for businesses seeking to expand internationally, engage in cross-border trade, and navigate the complexities of a globalized economy.

Introduction to Business

Meaning and Definition of Business