Understanding Political and Cultural Environments in Business Operations
Delve into the significance of political and cultural environments in business, with insights on how governmental policies and cultural factors impact organizational success. Explore the influence of stability, taxation, foreign policies, and cultural understanding on business strategies and growth.
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Libyan International Medical University Faculty of Business Administration Marketing Dana Dana Elgheriani Elgheriani dana_3792@limu.edu.ly ID:3792
Contents : 1. Introduction 2. The influence of the political and cultural environments 3 . 4. References Summary 1
Introduction Political environment refers to factors outside the company, relating to the government or public affairs of a country, influencing companies. On the other hand , culture environment refers to the environments shaped by human activities, such as cultural landscapes in the countryside, urban areas and cities . 2
What is Political Environment? Political Environment is the state, government and its institutions and legislations and the public and private stakeholders who operate and interact with or influence the system . 3
Importance of Political Environment Political Environment can be of utmost importance for a business. How a government make policies and what kind of economic measures it takes can determine the success or a failure of a business . 4
Various Political Environment related Factors & Elements 1. Stability 2. Taxation 3. Foreign Policies If a country is not stable and government keeps changing frequently, the country can never be economically stable as well . If a government is balanced in terms of tax and budge, the companies are motivated to produce more and grow . 5 If there is no foreign investment, growth and technical knowledge can be issues .
What is Cultural Environment? Cultural environment is a concept in business which helps to understand the customs and collective beliefs of a set of people or society based on their culture, religion, region, nationality, language . 6
Importance of Cultural Environment To understand the customers of a particular region, studying their social and cultural environment is very important , also to provide a unique edge to regions and places , serve as the foundation of the development of local communities and create business opportunities . 7
Components of Cultural Environment 1. Nationality 2. Religion 3. Language Religious practices and beliefs defines various factors on how a business should operate and communicate as it must be accurate about religion as well as be careful of handling sensitive issues. 8 The preferred language or mother tongue of a region, town, city, state or country can define the cultural environment. The values, history and beliefs of every country defines the cultural environment amongst the citizens of a country.
Summary : 1) We have understood that Political Environment is the state, government and its institutions and legislations and the public and private stakeholders who operate and interact with or influence the system . 2) Also that Cultural environment is a concept in business which helps to understand the customs and collective beliefs of a set of people or society based on their culture. 3) we learned that the 3 main components of cultural environment are : nationality , religion , language . 9
References : 1. Team, M. (2022). Political Environment Meaning, Importance, Factors & Example | MBA Skool. Retrieved 6 April 2022, from https://www.mbaskool.com/business-concepts/marketing-and-strategy- terms/2515-political-environment.html Team, M. (2022). Cultural Environment Meaning, Importance & Components | MBA Skool. Retrieved 6 April 2022, from https://www.mbaskool.com/business-concepts/marketing-and-strategy- terms/1802-cultural-environment.html 2. 10
