Effects the External Environment Have on Managerial Task Term Paper

Excerpt from Term Paper :

External environment plays a key role in the manager's roles. Different factors in the external environment create opportunity and present threats to which the organization needs to respond. It is important for managers to conduct an environmental scan in order to better understand the environment in which they operate. Juervicius (2013) explains one system, the PESTLE system, which forces managers to think about the different external factors that affect their business.

The PESTEL model features an analysis of the political, economic, social, technological, environmental and legal environments. For the manager, each of these provides the framework for analyzing the operating environment. These factors are all significant, and unrelated to other external factors like competition and demand drivers. For example, where there is political risk (like a government shutdown), the manager can better understand this risk by working through the PESTEL framework. The economy is a critical input, and technological changes can turn an industry upside down. Thus, managers must make their decisions for both the short-run and the long-run based on careful analysis of the external environment.

This analysis usually works in concert with an analysis of the internal capabilities and weaknesses of the firm, and an analysis of the competitive dynamics in which the company operates. With these different tools, managers will make more informed decisions that should result in greater success and better strategies over time.

Management theorists also have made a good contribution to business, in particular where they help managers to understand how management works. Different types of management philosophies have come into vogue and then fallen out of favor, and it is important for managers to be able to put their own training, biases and insights into perspective in the greater world of management. One influential theorist was Henri Fayol, an Istanbul-born Frenchmen who became one of the most important management theorists of the 20th century.

Fayol wrote the 14 Principles of Management, which remain relevant today (MindTools, 2013). These principles are:

Division of work



Unity of command

Unity of direction

Subordination of individual interests



Scalar chain



Stability of tenure of power


Esprit de Corps

Most of these ideas were relatively new to management thought, so to put them together in a single framework and ask managers to consider ways to implement them all simultaneously was one of the earlier attempts at codifying the practice of managing large…

Sources Used in Document:


Jurevicius, O. (2013). PEST and PESTEL analysis. Strategic Management Insight. Retrieve November 20, 2013 from http://www.strategicmanagementinsight.com/tools/pest-pestel-analysis.html

Mind Tools. (2013). Henri Fayol's Principles of Management. MindTools.com. Retrieved November 20, 2013 fro http://www.mindtools.com/pages/article/henri-fayol.htm

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