Three secondary areas that influence business policy

Settling business policy is not an easy task. Globally business finds this work daunting to such extent, that in addition to in-house deliberations it contracts out externally, professionals in the field of business strategy to have a look at business policy. There are two sets of areas that influence business policy. One primary and other secondary. Read for more:

The primary area consists of politics, economics and military known by its acronym PEM. I have in an earlier blog “Three primary areas that influence business policy” given a bird’s eye view on this subject. In this blog I am mapping how secondary areas, that is, society, technology and geography (STG) impact the formulation of business policy in corporates and even in state owned enterprises. 

Society

At the outset, it must be clearly and loudly pointed out that society matters in everything done in this world. It is the cohesive institution that passes judgement in politics, economies and military affairs, the underpinning areas in primary policy as well. If something is not acceptable to the society at large, then any policy in these areas have to be over turned. 

When General Douglas McArthur requested permission to use nukes against China in the Korean War 1950-53, President Harry S Truman mindful of the devastation caused in Hiroshima and Nagasaki by previous use of atomic weapon, flatly rejected it and later  removed the General for insubordination in 1951. Here President Truman listened to the society rather than military, which was a minuscule part of the society itself. 

Technology

As an enabler technology plays larger than life role in shaping up events, providing necessary platforms for humans to conduct their daily affairs. In business particularly, technology drives growth & change, the latter resulting in improvement and innovation of products, procedure and in a way, market acceptance of the change as such. In fact, technology is the ultimate instrument in change management that has brought up fresh demand for more techy products and enlarged the scope and activity for these. Today mobile technology has no bounds as it is the most ubiquitous product in the hands of every member of the society.

Geography

Both as a limitation factor and growth element geography has a vital role for countries, entities and also citizens. Limitation acts in two ways: one that it motivates entities to surmount the difficulties arising out of geography to find new ways of running a business. Farms in Siberia have perfected the art of surviving in the ice and growing grains. Other way, it makes business to get over it by finding out alternatives. Northern Route in Arctic is envisaged to be the next miracle like Suez Canal in 1859.

Positive side is the biggest boon offered by geography. Right from the beginning, Danube River which runs through ten countries namely, Ukraine, Moldova, Romania, Serbia, Croatia, Hungary, Bulgaria, Slovakia, Austria, and Germany provides them a basket of goodies in the form of transport, electricity generation, water supply, sustainable ecology and top of it all, a sense of belonging to the countries so that bonhomie pervades!

 

Cheers!

Muthu Ashraff Rajulu

Business Strategist

Mobile: + 94 777 265677

E-mail:   cosmicgems@gmail.com

Blog:   Business Strategist