External Factors Essay

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Internal and External Factors MGT/230 August 13, 2012 Dr. Joel Ginsburg, D.M. Internal and External Factors A company that performs well only does so because it has established a firm foundation and follows the four functions of management quite well. Additionally, it has learned effective means by which to address the internal and external factors that surround their business environment. McDonald’s is one of the largest fast food chains in the world with a reported 32,000 restaurants in 117 countries (McDonald's Corporation Case Study, 2012). This type of growth and success is reflected in McDonald’s methods of planning, organizing, leading, and controlling; that is to say, their management style. What are Internal and External Factors? All organizations exist in what is referred to as an open system. This means that a company’s success is highly affected by factors they may have little control over. Possessing little control does not mean any control. The key to success is for management teams to identify these factors quickly and react to them appropriately. Some such factors are globalization, technology, innovation, diversity, and ethics. How does Globalization and Technology Affect the Four Functions of Management? Globalization by definition is to extend to all parts of the world, thus becoming global. The biggest mistake a company can make when globalizing is to assume that consumer behavior will be the same in a different part of the world as it is in the United States. An example of proper planning and strong strategic thinking is McDonald’s summer marketing efforts in what is considered the most aggressive advertising market in the world; China. The goal was set forth to produce four television commercials on new products that would target the younger crowds. McDonald’s outlined business objectives were to gain market share from

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