HBM Unit 1 - Internal Factors

Business Environment

There are two business environments; internal and external.

• The Internal Environment is within the business.
• The External Environment is outside the business.

Internal Factors

Internal Factors are factors within the business that impact on its success. Due to them being within the business, the business has a degree of control over them. They can affect whether the business will achieve its objectives.

Factors of the Internal Environment:

• Finance = If able to access funding, the business can invest in new assets, research and develop the business.

• Staffing = Success depends on a motivated, skilled workforce who can grow the business. Experienced staff are more likely to make effective decisions. Businesses need a stable workforce i.e a low staff turnover.

• Information = Having information that is up-to-date/accurate means a business is more likely to succeed.

• ICT and Technology = The use of ICT gives a competitive edge.

• Corporate Culture = A strong culture that staff can embrace will result in motivated staff and a successful business.

Negative Internal Factors can be overcome by:

• Staff training
• Strict budgetary control
• Arranging bank loans
• Motivating employees

Corporate Culture

Corporate Culture is everything to do with the business i.e it’s values, written policies, procedures…