Operating environment in business is the outside circle influencing business, also known as external environment. Knowledge of the factors affecting the operating environment is needed to create and sustain customers.
For instance, cultural differences may be a challenge to a company in many different ways. Different nations have different business cultures that differ globally. A company in Turkey may be dealing with the same product as a company in China, but the management and operating process differ. This calls for a business person or company to know and understand the culture of a nation of interest before venturing in business. Also, the products produced should be relevant to the culture being targeted.
Likewise, gender difference exists and affects the operation of the company. If a certain area is highly populated by a certain gender, an organization will have to alter their operations to suit that particular gender since goods and services differ with gender. Take, a male populated area, a company like McDonald will have to produce more meals rich in energy compared to female populated areas.
National and racial differences affect every company, just like cultural issues. There are some products and services produced in some countries that are disapproved by others. A good example is movies. In Kenya, the movie ‘Wolf of Wall Street’ was banned due to principles and the complaints of parents. But, in countries like USA, the movie was easily available in their markets. With understanding of how different countries and nations perceive things, or employing the locals of that nation, this can be avoided.
Knowledge of these differences helps a company become competitive since, they will know how best to serve customers globally. It leads to customer satisfaction and with time, customer delight. It is upon each and every company to study its environments and take necessary action.
Needle, D. (2010). Business in Context: An Introduction to Business and Its Environment. New York: Cengage Learning EMEA.