In the present scientific age, not only the scope of business has become dynamic, but the business and industries have touched new Heights also. The importance of service industries in the business is growing day by day.
A business institution has always to face various complexities, challenges, and problems.
The changing economic, social, legal, political, and technical environment has created several new responsibilities and new roles.
Challenges Created by Business Environment
The business environment has created the following challenges, complexities, and responsibilities:
1. Environmental Balance
The foremost challenge before the business environment is to maintain a beautiful coordination between industrial production and nature because industries are dependent on natural wealth, raw material.
The continuous decline of natural resources due to increasing industrial production has forced to Businessman to explore various new sources of raw materials.
The decline of natural resources and beauty in the country have created the problem of social costs.
Therefore, maintaining the balance between industrial development and environment for the prosperity of the human society has become an important function and responsibility of the entrepreneurs or businessman.
2. To Safeguard the Dignity of Human Resource and Health
The workers, employees, and other persons working in any business are important human social capital.
The industrial production may be significantly enhanced by proper utilization of this capital and seeking its cooperation and using its immense potentials of efficiencies.
Hence, it is a challenge for the business managers to safeguard the dignity of human resources and health, so that their skills and capabilities may be utilized, to the maximum possible extent.
Besides, managers have also various challenges at the workplaces of the employees and the labour.
It requires participation to the workers in management, cordial human behavior, security of work and income, proper environment for work, health development and maintenance, retirement benefits, like gratuity and to bring about equality of work opportunities for women.
Related: 23 Key Factors Affecting Business Environment (With Examples).
3. Balance Between Ethics and Economics
For business, it is quite necessary to maintain the balance between ‘economics’ and ‘ethics’.
Ethics include conduct, behaviour, consumer satisfaction, humanity, well wishes, Non-Cooperation towards evils and help in pious works, etc., whereas economics include giving priority to wealth by ignoring human beings, study of economic activities of a normal person, welfare activities and study of human behavior, however, lack of business between the decisions and behavior.
However, lack of balance between the decisions and behavior and increasing effect of unethical conduct have posed serious challenges before the business.
Here, the same questions are important, first how to make the balance between economics and ethics, and secondly, how and in what way the challenges may be accepted.
In response to it, we may say that the business should be so managed and operated that it may not lag behind in moral standards and the scope of profits may also be not substantial.
Hence, every entrepreneur or Businessman should give proper weight to moral standards in more or less degree.
Not only that, ethical, efficient economic Outlook and establishing a balance between high economic performance (profits) and High moral standards (service) are also challenges for the business.
4. Criteria of Business Organization
The whole scope and behavior of the business have undergone significant changes due to continuous progress of science.
During the last few decades, substantial changes have taken place in the knowledge economy.
Knowledge has become the central point of the business and base of economic power and prosperity.
Primary, our economy is not a manufacturing unit. Now, ‘knowledge and not the wealth is the yardstick of industries.
Revolution in Information Technology has completely changed the basic recognization of the business.
Related: 11 Advantages and Disadvantages of Functional Organizational Structure.
5. Enhancing Productivity
Enhancing productivity of the nation is also a challenge and responsibility for the business in this dynamic and changing environment, so that people in the nation may get the commodities at reasonable rates and the government may also earn more income.
For it, challenges are as follows:
- Business should make efforts for maximum utilization of national resources, efficient management of natural and human resources, the proper combination of all resources and for enhancing the level of productivity.
- Due to Limitations of natural resources and continuous decay and increasing vacuum, it has become necessary that the business improves its production system to improve the productivity of the resources.
- The Businessman should use improved techniques, trained employees, new measures and methods, government policies, the cooperation of all parties of the society, the morale of the workers and efficient management, etc. to increase the productivity of the nation.
The business environment has posed the challenge of increasing the productivity of the nation, so that the people and government of the country may be benefits in all ways.
6. New Future and New Challenges
In the modern age, new techniques and knowledge are regularly developing.
The industries working with obsolete methods are perishing. The business is emerging with new markets, new demand, new dimensions, and new changes.
In this way, new techniques, global economy, mutism system, and knowledge economy are indicative of our new future and new challenges.
A Businessman is required to formulate his action plan, in accordance with them.
7. Consumer Relationship
In the 20th century, consumerism has strongly roped its roots. Consumerism is based on consumer satisfaction, interests, awakening, and services.
Hence, in the dynamic business environment, the consumers have strongly raised voice for their rights against the unethical conduct of businessman, substandard products, conspiracy, exorbitant pricing, false advertisements, and exploitative policies.
Now, the market has become ‘purchases market’ in place of ‘seller’s market’.
Now, the demand has started rising to enforce the rules ‘Sellers be aware’.
Hence, now in times to come, the need will not be consumers remaining conscious, rather the need will be of sellers remaining conscious.
Related: 21 Importance of Study of Business Environment (Explained).
8. Effective Balance Between Industrial Production and the Limits of Nature
Establishing an effective balance between industrial production and limits of nature is also a serious challenge before the businessman and entrepreneurs.
The reasons are as follows:
- Industrialization causes air, water and sound pollutions. Natural wealth and beauty are lost, which results into increase in social costs.
- Increasing industrial production has substantively reduced the natural wealth, which has forced to search various new sources of the raw materials.
- The polluted environment in society has increased. To reduce it, the business and industries should search new sources of energy and make efforts to save the wastages of natural wealth, so that balanced business environment may be restored. Otherwise, people in the present society will feel highly suffocated and raw materials for production will not be able to advance further.
9. To Control Anti Social Activities
Whereas the business and industries have made social progress, various social costs and problems have also emerged.
For example, misleading advertisements, looting, snatching money for from consumers pocket, black marketing, pollution, noise, dust, smoke, pressures on cities, unethical practices by Businessman, poisonous food articles, hazardous to life and inconvenient transportation, etc. As a become like living in the hell.
Hence, the Businessman and entrepreneur will also have to associate with the attempts to ensure that health of no person deteriorates and he may lead a healthy life, otherwise their industry and business will not be able to advance further.
10. Fulfilling Social Responsibilities
The sense of social responsibilities has emerged as a liability towards the society, along with the development of business the business.
The business owners responsibilities to all sections of the society, like employees, consumers, suppliers, community, government, Creditors, shareholder (owners), etc.
Related: 26 Challenges in Way of Social Responsibilities of Entrepreneurs.
Sometimes, it becomes difficult to establish coordination between these responsibilities due to various self-expectations from the business.
The consumer expects commodities at the lowest prices, supplies for maximum price, shareholders for maximum dividends and the employees for maximum salary.
Awareness all these sections of the society towards their contradictory right have posed serious challenges before the businessman.
11. To From Partnership of Government and Business
The scope of business activities has now become so wide that the responsibility of safeguarding the responsibility of social interests cannot be fulfilled by handing over the business activities exclusively either to the government or to the Businessman.
Besides, direct production and distribution of the commodities and services, the business also provides other contribution to the society.
- The Efficiency and effectiveness of the business may be increased by the partnership of the government.
- If the businessman makes combined use of his managerial abilities, techniques, modern resources and work plans, then the social objectives and ideals may be efficiently achieved.
Related: 13 Biggest Challenges Business Leaders Face Today (Updated).
12. World Wide Pressures, Demand and Needs
It has been observed that throughout the world, higher demands are for a Japanese car, American Computer Services, Indian wine, British insurance services, Swiss watches, Brazilian coffee, and Taiwan radios and transistors because possession thereof adds to the status of the owners.
The Businessman of developed countries has to face the challenges, like making production for increased demand in the world, to sell these to the poor nations at fair prices, provide cooperation to International situations, etc.
Hence, the Businessman of industrial Nations should strengthen the Economics of poor countries, and may also make efforts to solve the prevailing problems of poverty, unemployment, diseases, malnutrition, and starvations in the world.
Thus, we visualize that besides cooperating in economic development, the challenge of being sensitive towards the social requirements of the nations and culture and Expectations has also now become quite important and necessary.
This is the only challenges facing businesses and how they adapt to these challenges.
In developed countries, computer system, Communications, atom energy, industries, and new technologies, etc. have given high attention to production and experiments, but the production and experiments of these growing systems and new techniques have pushed the business organization and continuity whirling of social problems, and the social challenges have given significant emphasis on assuming responsibilities by the business.
Thus, now you knw the challenges created by business environment.
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