International Business Environment - Internal and External

2. CONTENT
• Introductions
• Meaning
• Three sets of environment
• Internal and external environment
• External environment
a) Micro
b)Macro
• Conclusion
• Bibliography
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3. INTRODUCTION
The international environment is going through a
historic transformation . We are moving away from a
world in which national economics were relatively
isolated from each other by different barriers ,
towards a world in which national economies, are
merging into an interdependent global economy
creates opportunities as well as presents challenges
and threats to the business.

4. INTERNATIONAL BUSINESS ENVIRONMENT
In the context of a business Firm, environment can be defined as
various external actors and forces that surround the firm and
influence its decisions and operations.
The two major characteristics of the environment as pointed out
by this definitions out by definition are:
A. These actors and forces are external to the firm
B. These are essentially uncontrollable. The firm can do little to
change them.

5. AN INTERNATIONAL TRADING FIRM
ENCOUNTER 3
SETS OF ENVIRONMENT
• The domestic environment, the foreign environment ,
and the global environment.
ex: an Indian firm engaging in international trade.
Domestic environment = governed by Indian Laws
Ex: The foreign Trade development and regulation act ,
FEMA, foreign trade policy etc…

6. • Regulations Relating to minimum export price ; also
affected /influenced by export promotions measures
also by the general business environment of the
country.
• Foreign environment :-environment in the relevant
foreign market and the international trade regulations.
• Global environment :- The global factors which affect
international trade
• Such as WTO principles and agreements other
international conventions /agreements/declarations .

7. INTERNATIONAL BUSINESS ENVIRONMENT
a) Internal environment
a) External environment

8. International environment
 Organisational structure
 Production
 Finance
 Marketing
 Human Resource
 R And D

9. EXTERNAL ENVIRONMENT
• Micro Environment
• Macro Environment

10. MICRO ENVIRONMENT
• Shareholders
• Creditors
• Bankers and financial institutions
• Competitors
• Suppliers
• Market Intermediaries
• Customers

11. MACRO ENVIRONMENT
•SOCIAL AND CULTURAL FACTORS
•TECHNOLOGICAL FACTORS
•ECONOMIC FACTORS
•POLITICAL FACTORS
•INTERNATIONAL FACTORS
•NATURAL FACTORS

12. CONCLUSION
Looking ahead, it appears that in the changing economic
scenario international Business is a way of life.
The global corporations have become the central forces
of the world economy and in linking foreign direct
investment, trade, technology etc.. They are a driving
force of world s growth. The firms will succeed or fail
would depend on their ability to deal with the dynamic
international environment.

13. BIBLIOGRAPHY
International Business
- P. SUBBA RAO