Assignment submission

Subject :- Strategic Management

Topic :- Remote and Operating Environment , Environmental

Forecasting

Presented by :- Jenny Shah

Guided by :- Dr Rajesh Bhatt

MBA Sem - 4

2021-2023

Department of Business Administration

Maharaja Krishnakaumarsinhji Bhavnagar University

Topic :- Remote and Operating Environment , Environmental
Forecasting
 Remote environment
 Factors of remote environment
 Operating environment
 The Organisation and its Operating environment
 Environmental Forecasting
 Types of Forecasting
 Case study
 References

Remote Environment :-
 The remote environment consists of various factors whether political, economic,
social, technological, legal, or ecological, affecting any operating situation of the
business firm. Popularly, this environment is also be called the external environment.
 It refers to external factors that are beyond the control of organization . These factors
can have a significant impact on the organization’s operations and its essential for
companies to keep close eye on the remote environment.
 This tool provides an at a glance view of the firm’s business conduct. Strategy
builders and managers use this tool for finding the firm’s current position in the
market.
Factors of Remote Environment :-
Operating Environment :-
 The Operating Environment, also called the competitive or task environment,
comprises factors in the competitive situation that affect a firm’s success in acquiring
needed resources or in profitably marketing its goods services. Among the most
important of these factor  are the firms competitive position, the composition of its
customers, its reputation among suppliers and creditors, and its ability to attract
capable employees.
 It refers to factors that are within the control of organisation such as its internal
processes, employees and organizational structure.
 Companies can directly influence and manage these factors to achieve their goals and
objectives.

Local community:- The local community is made up of the people who live in the
area where the business is located. Though not necessarily customers of the business
they are all neighbours to the business. They are concerned with the local
environment, infrastructure and the impact the business has on jobs and prosperity on
the local area.

Customers :- A customer is an individual or business that purchases another

company's goods or services. Customers are important because they drive revenues;
without them, businesses cannot continue to exist. All businesses compete with other
companies to attract customers, either by aggressively advertising their products, by
lowering prices to expand their customer bases, or by developing unique products
and experiences that customers love. Think Apple, Tesla, Google, or TikTok.
 Media :- The media industry is a business model based on communicating
information, art and entertainment to a large audience. The following are common
types of media industry. Publishing books, magazines, newspapers, comics,
references, blogs and research in both paper and digital formats.

Government agencies and administrators :- The term "government agency" or

"administrative agency" usually applies to one of the independent agencies of the
United States government, which exercise some degree of independence from the
President's control. Although the heads of independent agencies are often appointed
by the government, they can usually be removed only for cause.

Financial Intermediaries :- A financial intermediary is an entity that acts as the

middleman between two parties in a financial transaction, such as a commercial bank,
investment bank, mutual fund…

Financial intermediaries serve as middlemen for financial transactions, generally

between banks or funds.

Union :- A labor union is an organization formed by workers in a particular trade,

industry, or company for the purpose of improving pay, benefits, and working
conditions.

Suppliers :- A supplier is a person or business that provides a product or service to

another entity. The role of a supplier in a business is to provide high-quality products
from a manufacturer at a good price to a distributor or retailer for resale. A supplier in
a business is someone who acts as an intermediary between the manufacturer and
retailer, ensuring that communication is forthcoming and stock is of sufficient quality.

Activist Group :- An activist investor, typically a specialized hedge fund, buys a

significant minority stake in a publicly traded company in order to change how it is
run.

Environmental Forecasting :-
 Environmental forecasting is a technique whereby managers attempt to predict the
future characteristics of the organizational environment and hence make decisions
today that will help the firm deal with the environment of tomorrow. 
 This includes analyzing economic indicators, demographic changes, and technological
advancements to identify potential opportunities and threats to the business.
 Environmental forecasting helps companies stay ahead of the curve and adapt their
operations to changes in the business environment.
Types of Forecasting :-
 Economic forecast
 Social Forecast
 Political Forecast
 Technological Forecast

Economic Forecast :-
 Economic forecasting is the process of attempting to predict the future condition of
the economy using a combination of important and widely followed indicators.
 Important economic factors often considered include general economic condition,
GDP, growth rate, per capita income, distribution of income, structural changes in
GDP, Investment and output trends in different sectors and subsectors/ Industries,
price trends, etc
Social Forecast:-
 Social forecasting is a crowdsourcing approach, the aim of which is to aggregate the
distributed knowledge of employees and experts and convert it into quantifiable
business indicators, which are then available to the company management.
 There are number of social factors which have profound impact of business. It is
therefore very essential to forecast the possible changes in the relevant social
variables. Important factors include population growth/ decline, age structure of the
population, ethnic composition of population, occupational pattern, rural urban
distribution of population, migration, factors related to family, lifestyle, income
levels, expenditure pattern, social attitudes etc.
Political Forecast :-
 Political forecasting aims at forecasting the outcomes of political events.
 Political events can be a number of events such as diplomatic decisions, actions by
political leaders and other areas relating to politicians and political institutions.
 The area of political forecasting concerning elections is highly popular, especially
amongst mass market audiences.
Technological Forecast :-
 Innovations and other technological developments an drastically alter the business
environment. Technological forecast therefore implies great significance.
 Technological forecast encompass not only technological innovation but also the
pace and extent of diffusion and penetration of technologies and their implications.
Case study :-
 Reliance Industries Limited or RIL is commonly known as Reliance. The company
was founded by Shri. Dhirubhai H. Ambani in 1977 the company was initially started
as a textile company and led its evolution as a world leader in materials and the
energy value chain.
 The Company’s operations can be classified into four segments namely:
• Petroleum Refining and Marketing business
• Petrochemicals business
• Oil and Gas Exploration & Production business
• Others

Political factors :-
 Political factors include government policies relating to the industry, tax policies,
laws and regulations, trade restrictions and tariffs etc. As in any part of the world,
political influence is highly essential to start a business in India.
 Especially if you are planning to start a multi-billion business, some sort of political
patronage is an absolute necessity. Not only for safeguarding the interest of the
company but even to begin the process of getting the required sanctions, one requires
hold in the high echelons of politics and administrative circles.
Social factors :-
 Social factors often look at the cultural aspects and include health consciousness,
population growth rate, age distribution, changes in tastes and buying patterns, etc.
 Safety of a person overrides all the production targets’ is the Health, Safety and
Environment Policy of Reliance.
Economic factors :-
 The economic factors relate to changes in the wider economy such as economic
growth, interest rates, exchange rates and inflation rate, etc.
 These factors comprise of Government intervention in the free market, infrastructure
quality, economic growth rate, availability of labour, wage rate of labour.
Techonolgical factors :-
 The technological factors relate to the application of new inventions and ideas such as
R&D activity, automation, technology incentives and the rate of technological
change.
 RIL has always laid emphasis on R&D, technology development and innovation. The
reliance Group (RTG) undergoes various research and technology functions which
 help them produce improved value supply by leveraging all the abilities, and creating
new prospects at the interfaces.
References :-
 Remote Environment - Definition and more | THE-DEFINITION.COM
 Remote Environment - QS Study
 Operating Environment - Definition and more | THE-DEFINITION.COM
 Environmental Forecasting: Methods, Techniques and other Details
(yourarticlelibrary.com)
Thank you …