Principle of Management homework

Principle of Management The dominant view in management theory and society in general is that managers are directly responsible for an organization’s success or failure; this is the omnipotent prospective view of management. Others have also argued that the organization’s success or failure is due to external forces outside the manager’s control. The six external environment components are demographic, economic, technical, sociocultural, political and legal, and global. It is important that managers understand these components because it poses constraints and challenges to managers. In the 1980’s the U.S economy was growing and tax rates were low, low inflation and low interest rates fueled consumer spending. Individual took risk by investing in the stock market, buying houses, and starting their own business. In 2008 gas price hit $4 plus per gallon, adjustable mortgages adjusted upward with higher monthly payments due, many consumers couldn’t keep up. Continuing advances in technology make-work more efficient and improve available information and communication. Technology is any equipment, tools, or operating methods that are designed to make-work more efficient. Intranet is a private computer network that uses Internet technology and is accessible only to organizational members. It is important for managers to pay attention to demographic trends and shifts because it can prepare a long-term marketing strategy to be ready when the shift becomes more apparent. Environmental uncertainty is situation where the management of a firm has little information about its external environment that is a state of flux and hence, largely unpredictably. Business are built on relationships means that managers must actively involve themselves in the external environment. They must be proactive and do things like networking with people