Aung Sithar - Weekly MBA

In economics and management, studying global economic pressures and changes is essential to understanding today's management practices. It is also essential to understanding your future path. This course is fundamental to understanding how businesses operate and how they structure their operations in the face of today's societal pressures and forces that affect organizations and businesses around the world.

Main pressures

I would like to highlight some of the important pressures that are affecting the global economy. The impact of change and new pressures has been important throughout economic history in governing the operation of organizations and setting rules and regulations.

• World Financial Economics

After we emerged from the 2007/2008 economic crash, we imposed some new regulations on banks and the banking system.

• Geopolitical changes

For example, the emergence of China and India as superpowers, Russia's expansionist ambitions in Eastern Europe, and conflicts in the Middle East are significant changes for businesses.

• Communication

We will study the increasing power and intelligence of computers and the impact of these changes on the future labor market.

• The changing nature of security, crime, conflict, and policing

For example, the increasing use of drones and robots in high-risk areas, the emergence of cyberwarfare and cyberattacks, and the growing importance of cybersecurity.

• A new era of transportation and communication

A new era of transportation for people, emergency and health assistance, raw materials and finished goods.

• Environmental change

The impact of this change on global society (for example, dams and large tunnel projects in China are causing migration of people and businesses. The movement of Arctic ice caps is creating shorter and more efficient sea routes, making the exploration of the region's resources more cost-effective.

Environmental change

A manager needs to understand the nature of how businesses operate. Businesses, especially your own company, do not exist in a vacuum. There is an environment that is relevant to your company. I want to make the product I want to make. If I make it well, it will sell. If it is good quality, it will sell. If it is cheap, it will sell. The reason why many of the assumptions that I make about what will happen if I do this are wrong is because they do not take into account the environment. While it is true that a business produces and sells, the environment has a huge influence on that process.

If we do not take into account the changes in the environment in which our business operates, our business decisions and actions will not be correct. Therefore, before doing anything, we need to study the environment. The environment of businesses can be divided into two categories: the outer circle and the inner circle.

The types of environments in the outer circle are

(1) Political and legal environment

(2) Business environment

(3) Social environment

(4) Technology environment and

(5) The environment.

The unique thing about the outer environment is that changes in these environments have a significant impact on businesses, but businesses cannot control them. Therefore, businesses can only succeed if they are able to study the current state and changes in these types of environments and act accordingly. If these changes signal an opportunity, you need to be prepared and wait. Since you cannot control the negative environmental changes, you also need to study them in advance to minimize the negative effects as much as possible.

Political and legal environment

The political environment includes, in particular, government policies, the political situation of the country and government-to-government cooperation, government transitions, and changes in laws. The political environment laws that affect business are:

- Bureaucracy

- Level of corruption

- Freedom of the press

- Customs

- Trade policy

- Education Law

- Labor Law

- Tax rate

- Consumer Protection Policy

- Competition Control Law

- Commercial Tax Law

- Income Tax Law

etc. The government's decisions on these points are

- Business

- Control

- Political stability and

- Businesses should study the changes in this environment and make decisions carefully, as they can affect risk.

Economic environment

The economic environment for businesses is about products and money. Changes in the economic environment have a greater impact on the country's finances and other economic indicators than they do on businesses themselves. But the effects of this environment that will directly affect you are the factors that affect demand, taxes, and property valuations, as well as other factors that make up this environment.

- interest rate

- Exchange rate

- Inflation rate

- With tax

- Demand, supply

-Income level. By analyzing the above factors in the economic environment in advance, you can create a strategy or method that suits your business.

Social environment

Social environment is actually the study of changes in society. Businesses often choose other political and economic environments depending on the business when it comes to environmental studies, but now every business studies the changes in the social environment. When it comes to social environments, you should mainly study the characteristics and customs of the society. This is where your business's market research becomes important. The more detailed you can study the factors involved in this environment, the more beneficial it is for you. The main factors involved in this environment are:

- Lifestyle and status

- Purchasing habits

- Educational level

- Religion and Belief

- Health care

- Gender ratio

- Family size and type

- Attitude towards saving and using money

- Population growth rate

- Age difference and average age

- Attitude towards life

(Work, Money, and Rest)

- Dress

- Food style

- Preferences and customs, etc.

Studying the above things is your

- What product will be produced?

- For whom will it be produced?

- At what price will it be sold?

- In what format will it be sold?

- How much should I sell?

- How to advertise.

It can help answer questions about decision-making and forecasting.

Technology environment

The technological environment includes the existence, availability, and development of technologies, from arithmetic to fuel combustion.

You may be wondering how the technological environment can affect businesses. As long as you can see the technology that you use every day in your life and in your business. From your car, to your shirt, to your computer, to your chair, nothing can escape technology. Businesses cannot escape technology either, so you need to keep an eye on the changes related to technology. Technology can change your business.

- Improve efficiency,

- Cost savings

- It can provide benefits such as increased profits, but it also ignores technological changes.

- Destroying your business (The advent of digital cameras destroyed Fuji's film camera business. Fuji was the world's number one camera manufacturer at the time.)

- Being behind your competitors (Nokia was late to adopt smartphone technology and was overtaken by Apple and Samsung.)

The unique thing about technology is that it doesn't have the same environment as the ones above. What it does have will only be known when new things emerge. Some of the recent technological changes are: