Introduction to Administrative Studies
Dr. Len Karakowsky ADMS 1000
Session 1
EXPLORING THE CANADIAN BUSINESS
ENVIRONMENT:
A FRAMEWORK
What are the fundamental external forces which all
organizations must confront in their struggle to
survive and prosper?
Reading:
Karakowsky (2011) Chapter 1
Introduction to Administrative Studies
Dr. Len Karakowsky ADMS 1000
ORGANIZATIONS AS OPEN SYSTEMS
What is an organization?
-Social entities
-Goal oriented
-Interact with the environment
Introduction to Administrative Studies
Dr. Len Karakowsky ADMS 1000
ORGANIZATIONS AS OPEN SYSTEMS
Metaphors to describe
organizations
-Organizations as open systems
Introduction to Administrative Studies
Dr. Len Karakowsky ADMS 1000
THE EXTERNAL CONTEXT OF BUSINESS
SPECIFIC ENVIRONMENT
GENERAL ENVIRONMENT
Introduction to Administrative Studies
Dr. Len Karakowsky ADMS 1000
The environment of business: FORCES THAT
DETERMINE BUSINESS SUCCESS OR FAILURE
• WE NEED TO CONSIDER THE EXTERNAL
FORCES – THESE ARE FORCES THAT ACT ON
ALL BUSINESSES IN ANY LOCATION IN THE
WORLD.
Introduction to Administrative Studies
Dr. Len Karakowsky ADMS 1000
GENERAL EXTERNAL ENVIRONMENT OF BUSINESS
Labour
competitive
economic
The
Organization
political
societal
technological
global
Introduction to Administrative Studies
Dr. Len Karakowsky ADMS 1000
1. ECONOMIC FORCES
• An economic slump can mean downsizing,
cuts in training and staff development, end
of traditional work practices etc
• An economic boom can mean expansion,
extra training, R & D etc
Introduction to Administrative Studies
Dr. Len Karakowsky ADMS 1000
2. COMPETITIVE FORCES
• Business must think about
who their competitors will be
• Competition may be at a
local, national or global level.
It may be open or restricted
• What are the advantages and
disadvantages of
competition?
Introduction to Administrative Studies
Dr. Len Karakowsky ADMS 1000
3. TECHNOLOGICAL FORCES
• Technology has an important influence
on organizations - accessibility
influences market entry and operating
costs
• Consider how technology has
influenced the role of work and how
work is done, e.g. teleworkers, flexible
work practices
Introduction to Administrative Studies
Dr. Len Karakowsky ADMS 1000
4. LABOUR FORCES
• The changing nature of the workforce
• The increasingly diverse nature of the
workforce
• As a “voice” for the labour force,
consider how unions have impact work
and society
Introduction to Administrative Studies
Dr. Len Karakowsky ADMS 1000
5. GLOBAL FORCES
• Global forces have an
international dimension
• Organizations must now think
globally
• Global forces have resulted in
business outsourcing in order
to gain a competitive
advantage
Introduction to Administrative Studies
Dr. Len Karakowsky ADMS 1000
6. POLITICAL FORCES
• Political change can be very influential e.g.
deregulation of Canadian Telecoms,
banking industry, reduction of trade
barriers, changing political leaders
• In Canada there is a move towards less
government intervention
Introduction to Administrative Studies
Dr. Len Karakowsky ADMS 1000
7. SOCIETAL FORCES
• How can society impact
business?
• What responsibilities does
business have to society?
• Has the increasingly
global nature of business
created new
responsibilities for
business?
Introduction to Administrative Studies
Dr. Len Karakowsky ADMS 1000
CANADA: A GREAT PLACE TO DO
BUSINESS?
• HOW WOULD YOU DESCRIBE THE
CANADIAN BUSINESS
ENVIRONMENT?
• IS CANADA A GOOD PLACE FOR
BUSINESS? FOR YOU AS A
PROSPECTIVE EMPLOYEE?
•IE WHAT’S THE ENVIRONMENT
OF BUSINESS?
Introduction to Administrative Studies
Dr. Len Karakowsky ADMS 1000
….IN CANADA
1. ECONOMIC FORCES
• Gross Domestic Product (total value of a
country’s annual output of goods and services)
• Money from the production goes to employees,
business owners and the government (through
taxes).
• We want GDP to grow annually!
Introduction to Administrative Studies
Dr. Len Karakowsky ADMS 1000
… IN CANADA
2. COMPETITIVE FORCES
What competitors are doing in your industry
obviously will influence your success or
failure. Which industries are very
competitive right now?
Introduction to Administrative Studies
Dr. Len Karakowsky ADMS 1000
…IN CANADA
3. TECHNOLOGICAL FORCES
Resource based economy (farming, mining,
forestry etc) now moving to manufacturing,
technology and service sector – e.g.
telecommunications, energy etc
Introduction to Administrative Studies
Dr. Len Karakowsky ADMS 1000
…IN CANADA
4. LABOUR FORCES
Canada has a demographically diverse
population and it is important that we
maximize the value of this diversity
Introduction to Administrative Studies
Dr. Len Karakowsky ADMS 1000
…IN CANADA
5. GLOBAL FORCES
• Canada exports over 40% of its GDP – a major
trading nation through agreements such as
NAFTA
• Foreign ownership of Canadian companies is
becoming increasingly common.
Introduction to Administrative Studies
Dr. Len Karakowsky ADMS 1000
…IN CANADA
6. POLITICAL FORCES
Capitalist economy but the government also has
an important role in the business environment,
e.g. taxes, subsidies, global trade agreements
etc.
Introduction to Administrative Studies
Dr. Len Karakowsky ADMS 1000
… IN CANADA
7. SOCIETAL FORCES
Increasing need for higher education,
immigration, aging population, changes in
employment law, declining birthrates, women
in the workforce
Introduction to Administrative Studies
Dr. Len Karakowsky ADMS 1000
KEY LEARNING POINTS
• Nature of external forces
• Concept application introduction
• Next: do end of chapter case