The task environment includes those sectors that have a direct working relationship with the organization among them customers competitors supplies, and the labor.
People and organizations in the environment who acquire goods or services from the organization
Those people of an organization in the environment who acquire goods or services from the organization are customers. As recipients of the organization’s output customers are important because they determine the organization’s success. Patients are the customers of hospitals, students, the customers of school and travelers, the customers of airlines. Toy companies have to stay in close touch with the whims of young customers and their parents. Mattel is hoping that by snapping up rights to make toys tied to Yu-Gi-Oh! A popular Japanese monster themed show and Sponge Bob Square Pants it can create products that will fly off shelves rather than sit in warehouses. Mattel is also bringing out a toy that can pick up digital signals from the new Warner Bros. Batman cartoon shows running on cable networks meaning a toy Bat mobile will soon be seen across the floor at the exact moment the cartoon car shows up on the television screen.
A big concern for managers today is that the Internet has given increased power to customers and enabled them to directly impact the organization : For example gripe sites , where customers and sales associates cyber vent about the nation’s largest retailer, where Unite Airline employees and disgruntled fliers rail against the air carrier, can quickly damage a company’s reputation and sales. In this new information environment says CEO e-commerce consultancy Agency.com you’ve got to assume everyone knows everything.
Other organizations in the same industry or type of business that provide goods or services to the same set of customers are referred to as competitors. Each industry is characterized by specific competitive issues. The recording industry differs from the steel industry and the pharmaceuticals.
Competitive wars are being waged world wide in all industries. Coke and Pepsi continue to battle it out for the soft drink market. UPS and FedEx are fighting the overnight delivery wars. Home depot and Lowe’s are brawling in the retail home improvement market, trying to out do one another in terms of price, service and selection. This chapter’s Unlocking Creative Solutions. Through Technology box describes how retailer Target has achieved a competitive edge with strategic use of the Internet. In the travel and tourism industry, Internet companies like Expedia.com and Hotels.com have hurt the big hotel chains. These chains are fighting back by undercutting the broker’s prices on the hotel’s own Web sites, In addition, five of the largest chains have banded together to create Travelwebcom, which is aimed directly at the online brokers.
People and organizations who provide the raw materials the organizations uses to produce its output.
The raw materials the organizations uses to produce its output are provided by suppliers. A steel mill requires iron ore, machines and financial resources. A small, private university may utilize hundreds of suppliers for paper, pencils, Cafeteria food, computers, trucks, fuel, electricity and textbooks. Companies from toolmakers to construction firms and auto manufacturers were hurt recently by an unanticipated jump on the price of steel. Just as they were starting to see an upturn in their business, the cost of raw materials from suppliers jumped 30 per cent in a two month period. Many companies are using fewer suppliers and trying to build good relationship with them so that they will receive high quality parts at lower prices. The relationship between manufacturers and suppliers has traditionally been an adversarial one, but many companies are finding that cooperation is the key to saving money, a maintaining quality and speeding products to market.