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(Management Class) “Businesses are built on relationships.” What do you think this statement means? What are...

(Management Class)

“Businesses are built on relationships.” What do you think this statement means? What are the implications for managing the external environment?

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The statement Businesses are built on relationships impacts the external environment. Since in order to achieve the business goals it needs to interact with the environment. To continue its operations business needs to manage customer relationships, competitors, suppliers etc. The business is required to maintain all these interaction in order to protect the interest of the business.

This implies that managers should engage themselves in the external environment. They need to maintain network with the clients who are important to them. When we say that businesses are built on relationships, we mean that it is necessary for people in one firm to have good relations with people in certain other firms. These relationships help to cultivate business. It is the responsibility of managers to actively maintain the network among people in the external environment.

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