The environment of an organization

The environment of an organization

The environment of an organization can be termed as the conditions surrounding a firm and forces that impact on its performance. There are internal and external factors that influence the development of activities and operating performance of an organization. Environmental changes can, therefore, have impacts on the organization in various factors as discussed below.

External factors.

Political factors play a major role in the organization. They include legal factors, policy frameworks, and regulations that provide guidance. There is a relationship created between business and political power. This includes tax regime, commercial law, and labor law. Secondly, economic factors that affect organizational performance through fluctuation, inflation, and interest rates. This is enhanced through fiscal policies. Finally, the existence of technological factors contributes to environmental changes through productivity. This can be achieved by creating new products in line with the consumption of the current trends.

Internal factors.

Communication as a factor plays a major role whereby leaders communicate freely with their junior on matters concerning the productivity of the firm thus, bringing a healthy working relationship and gives room for any improvements and change needed. Secondly, Structure in different organizations has been arranged in a hierarchical manner that brings order and specialization in a firm and this may be adjusted depending on the changes needed. Finally, learning by workers in an organization enables, them to acquire new knowledge that enhances improvement in the performance.

Conclusion

Management can guide the organization by ensuring there is flexibility in the above factors that can enable it to embrace changes that may occur as far as current trends are concerned. This can be done by enhancing political and legal stability and creating a good accommodating working environment.