Question

Each of you need to find a current news article from a reputable, business-focused source (e.g., Wall Street Journal, Fortune, Kiplinger's, or Forbes) that illustrates either a political/governmental or sociocultural external force and its impact on your industry. In this blog, post the link to the article and your analysis of what impact the specific force will have on your industry within the upcoming year. Please do not repeat articles, unless you are focusing on the impact in a different industry.

Choices:

• Political or governmental forces can be at the local, regional, national or international level. As we rely increasingly on global markets and governments for success, we also need to consider our relationships with these entities as well as their fiscal and monetary policies and their overall stability.
• Sociocultural forces are an important part of the external environment and include not only the cultural norms and values of our society, but also such demographic factors as age, marital status, income, lifestyle, etc. It is important to monitor these ever-changing forces and to adapt your strategy accordingly to maintain your competitive advantage.

Answer 1

In these case observation, where the political or sociocultural external forces impacted on one organization, and the impact actually based on the specifics of government norms, cultural norms, and social norms. The analysis is based on a company called, Coca-Cola. The Coco-cola company is a multinational company with established around every continent and the foothold around the markets. The company is offering soft drinks at core distribution or production and supply over the markets by following the policies, regulations, and guidelines of the local, state, national, and global standards, but in some economies, it may get reverse and the potential impacts are for their product offerings.

Even though the company is a multinational entity, but the company specifically relay on the national policies, both fiscal and monetary policies over the respective country and that determines the stability of the Coca-Cola in that market. Also, the external environment affects the dynamics of the product like values, cultures, demographics, age, income level, lifestyle, marital status, and so many factors apart from the government or political conditions. In the United States of America, the company is falling under the category of Food and Drug Administration (FDA), under the agency of the United States Department of Health and Human Services. The department ensures to monitor and track the product batches for quality checks, any misleading marketing trends, nutritional values, or safety standards of the company.

Business environment and impact on the industry

The business environment includes the total of individuals, other institutions, government, and other forces that have control over the business from outside and it may affect the performance of the company. The major factors are social, economic, political, and technological forces from outside the internal environment. Also, the non-government organizations, governments, consumer groups, courts, competitors, media, and other institutions form the external environment that has a hold in the performance of the company.

The business environment has certain features like aggregative nature, inter-relatedness, dynamic nature, complexity, uncertainty, and relativity. Below are a few examples of how the business environment connected with Coca-Cola in the USA in 2008. On the basis of the above topics, the FDA produces a warning letter to the company on the subject of the company is misleading the consumers on the terms of nutrition, and the company is not meeting the policies. The FDA also creates pressure to reduce the less-fattening products in the market and surge the company to create a new nutrition panel in the company.

Positive impacts of Business environment

Political Analysis: The Company largely depends on the rules and policies issued by the government. The constantly changing accounting standards, environmental laws, and taxation requirements in the domestic market for foreign jurisdictions invite troubles to the company. The company get benefited by the policies in the expansion scenario to Eurasia, North Asia, and Middle Asia increased the sales to 11% in 2005. It strictly depends on the political and social scenarios.

Social Analysis: The social factors like lifestyle changes and the conscious buyers directly support the growth of the products. It all depends on the size of the market, and potential market in terms of citizens are practicing the healthier way of non-beverage consumption rather than alcoholic beverages (in Oxford, 2007). It generates a growth of sales in the segment, by the sale category in the age group of 37 to 55 years. Before the boom in sales, the company pathetically failed to achieve a grip in the market, but the social change helps the company to achieve the results on paper.

(Reference on Wall Street Journal - https://www.wsj.com/articles/fda-approves-controversial-changes-to-nutrition-facts-panel-1463750195) and quoted business environment related books for the theories.