2

Chapter

The
Management
Environment
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Learning Outcomes
Explain what the external environment is and
why its important.
Discuss how the external environment aects
managers.
Dene what organiza.onal culture is and why
its important.
Describe how organiza.onal culture aects
managers.
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2.1 Explain what the

external
environment is and
why its important.

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External Environment

Factors, forces, situa.ons, and events outside
the organiza.on that aect its performance.

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Components of the External

Environment

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How Has the Economy Changed?

Turmoil in mortgage markets
Spread to businesses
Great Recession
Foreclosures, unemployment, public debt, and
social problems

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Economic Inequality
Harris Interac.ve Poll:

Only 10 percent of adults think economic
inequality is not a problem at all.

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How Much Dierence Does a

Manager Make?

Managers:

All powerful OR helpless?

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Demographics

Demography is desGny.

Age Cohorts

Baby Boomers
Gen X
Gen Y
Post-Millenials

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2.2 Discuss how the

external
environment affects
managers.

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How Does External Environment

Aect Managers?
Jobs and employment
Assessing environmental uncertainty
Managing stakeholder rela.onships

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Assessing Environmental
Uncertainty

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Managing Stakeholder
RelaGonships

Stakeholders:
any cons.tuencies in an organiza.ons
environment that are aected by that
organiza.ons decisions and ac.ons.

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OrganizaGonal Stakeholders

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Good stakeholder relaGonships:

Can lead to desirable organiza.onal outcomes
Can aect organiza.onal performance
Demonstrate doing the right thing

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2.3 Define what

organizational
culture is and
explain why its
important.

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What is OrganizaGonal Culture?

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OrganizaGonal Culture

Shared values, principles, tradi.ons,
and ways of doing things that inuence the
way an organiza.ons members act.

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Culture is:

1. Perceived
2. Descrip.ve
3. Shared

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Dimensions of Culture

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2.4 Describe how

organizational
culture affects
managers.

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How Does OrganizaGonal Culture

Aect Managers

Eect on what employees do and how they
behave
Eect on what managers do

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How Does Culture Aect What

Employees Do?

Strong cultures:
cultures in which the key values are deeply held
and widely shared.

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Strong Cultures Can:

Subs.tute for formal rules and regula.ons
Create predictability, orderliness, and consistency

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AcclimaGng to Corporate Culture

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How Does Culture Aect What

Managers Do?

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Company Values Aect Managers

Behavior

Ready-aim-re versus Ready-re-aim

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Managerial Decisions Inuenced by

Culture

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