XII BUSINESS STUDIES(CASE STUDIES) (GA) 10

Guruji Academy
CHAPTER - 3 (BUSSINESS ENVIRONMENT)
1. ‘The first masters’ is a leading advertising company in its industry. Recently they had a meeting in which all the
reasons which were outside the control of the organisation were discussed. The organisation wanted to maintain
its supremacy in the market. They decided to break the meeting into two parts. In the first part customers,
competitors, suppliers, etc. were discussed where as in the second part the political, economic, social conditions in
the country were discussed. It was concluded that company was doing extremely well in the domestic market and
the client base was expanding. However when the company’s performance in foreign markets was evaluated it
was found that conditions were different in different countries so the strategies adopted would have to be differ-
ent. After the meeting the company was looking forward to making new gains.
Which features of Business Environment have been highlighted in the above case? Also identify the lines.
2. Bright Services is a taxi service provider. The company is targeting a revenue of 50 crore rupees this year.
However with the passage of time it has found entrance of new service providers in the market which was not
expected at one stage of time. It has a good team of technicians, drivers, software providers, etc. The company
has decided to make it adaptable to such continuously changing circumstances. It knows that if it has to expand in
new countries it will have to learn the basic differentiating factors like traffic rules, technological aspects, etc.
Thus it understands that conditions are different in different countries.
‘Which features of Business Environment are discussed in the above case? Which force is discussed above?
3. ABCDEF Ltd. decided to start its new venture in Delhi. For this they needed to understand the Business Environ-
ment of the area. It was realised by the company that the Business Environment of Delhi was very hard to
understand unless and until it was divided into different business dimensions like legal, political, economic, social
and technological conditions. After understanding the business situations the company started to study the close
links between d?ferent elements of the Business Environment. They gave a proper shape to their research and the
business got started with full force. Later they realised that the products they were selling in Delhi were more fit
for the European culture and decided to start a new branch in Belgium where the demand of their products was
very high from the first day. The company came to be recognized and in few years became a global brand. The
reason for its success in different countries was the adaptability it showed in meeting the changing environment.
The company kept track of all happenings and did a periodic survey of the choices of the customers. It recognized
that there was no surety in the nature of market and it was very unpredictable.
Which features of Business Environment have been highlighted in the above case? Identify the lines which
highlight these features.
4. A company is a component of market. It utilises various raw materials, labour force, human resources, power,
water, other sources, etc. When all these resources are utilized output is produced. But before output is produced
the input has to go through various operations. These operations convert the raw materials into final products
which are then sold in the market.
In the above paragraph which importance of Business Environment is highlighted?
5. The market is flooded with better quality toys of foreign origin. The result is fall in revenue of the indigenous or
local companies as their products are much inferior and are also costlier in less demand in the market.
Which dimension of Business Environment can be seen here affecting the local companies’ revenue?
6. The sale of sarees increases in the months of the year when a large number of marriages take place in India. The
saree manufacturing companies make special plans of sale for these months.
Which dimension of business environment comes into picture here?
7. We can expect high sale of sarees in India but we can't expect the same in UK.
Which feature of business environment is discussed in the previous line?
8. Advertisements of a protein supplement must inform the potential buyer that the product if taken beyond a given
dose cangbe harmful to the diabetics.
Which dimension of business environmentis highlighted here?
9. Long Drive Manufacturers is a leading vehicie manufacturing company. It claims that it can create a fuel in its
laboratory which can run the newly designed car.
The company is ready to provide this fuel to its customers for free for one year provided they buy the car.
Which dimension of business environment is affected here by the company's innovative solution?
10. Identify the various dimensions of business environment:
a) With the election of a new government the sensex drops by 748 points.
b) A particular channel refrains from showing the advertisement of a particular product as it is banned by the
government.
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XII BUSINESS STUDIES(CASE STUDIES) (GA) 11
c) A software is in high demand among the industrial buyers as it can connect all the branches of a company as
a single integrated unit.
d) At the time of holi a large number of manufacturing firms get involved in making colours which are used in the
celebration of this colourful festival.
e) It is not advisable to open a luxury car showroom in the middle of an economy where per capita income is very
low.
11. A recent rate cut in the interest on loans announced by the Banks encouraged Amit, a science student of Progres-
sive School to take a ioan from State Bank of India to experiment and develop cars to be powered by fuel
produced from garbage. He developed such a car and exhibited it in the Science Fair organized by Directorate of
Education. He was awarded first prize for his invention.
Identify and explain the dimensions of business environment ‘discussed in the above case.
12. With change in the consumption habits of people, Neelesh, who was running a sweets shop shifted to chocolate
business. On the eve of Diwali he offered chocoiates in attractive packages at reasonable prices. He anticipated
huge demand and created a website chocolove.com for taking orders online. He got lot of orders online and
earned huge profit by selling chocolates.
Identify and explain the dimensions of business environment discussed in the above case.
13. “Wor1d Softwares” is a software giant. It has many branches throughout the world. The company knows that it
has great opportunities in its path. When it started it was limited only to its native country. With the passage of time
within 20 years the economies of various countries have integrated. This has come as a great advantage to this
company which has expanded. In many of the countries where it has its, branches the control of government in the
public sector enterprises has diluted leading to more control in the hands of the private sector. One of the major
reasons for the success of the company has been the role of the initiator the company has played as it was the first
company of its kind to enter the market.
Identify the two important concepts highlighted above. Which type of advantage has been indicated in the last line
of the above case?
14. Metlapp Networks and Technologies Ltd. is a "leader in technology innovation in the United" States, creating
products and solutions for connecting the world. It has a large research and development team which invented the
first smart watch, named as W-7. The watch besides showing the time, also monitors few health parameters like
heart beat, blood pressure etc.
While in search of markets abroad, the company found that in India, the reform process was underway with the
aim of accelerating the pace of economic growth. The company decided to take advantage of simplified export
procedure and removal of quantitative as well as tariff restrictions in India.
It set up its office in Iamnagar with a view to capture the Indian market. In a short span of time, the company
emerged as a market leader. Success of the company attracted many other players to enter the market. Compe-
tition resulted in reduction in prices, thereby benefiting the customers.
a) In the above paragraph, two major concepts related to government policy have been discussed. Identify and
explain these concepts.
b) Also, explain briefly any three impacts of these concepts on Indian business and industry.
15. The internet has taken the whole world by surprise. The government has also been lenient in giving the online
companies a chance to flourish in the changing business scenario. Intemeters Online is an entrepreneurial initiative
by a group of young engineers. The company has entered in the domain of providing products online. Many new
firms have also entered after seeing them enter this mode of business and many of these firms are foreign in
origin. The companies dealing in online business know that in today's world customer has many options. The
customer is no more dependent on a single company for the product he requires. This has empowered the cus-
tomer who has more choices and the result is a fragmented market. The firms selling with monopoly in the market
are the stories of the past. The products offered by the companies are going through different types of technologi-
cal changes. The companies are trying to give variety of products which are technologically advanced. “Interneters
Online” is a firm which is right now selling 200 products online. Recently it tried to increase the number of
products to be sold by 15 but it realised that many of these products were not allowed by the government to be sold
in their territory.
Identify three impacts of government policy changes on Business and Industry highlighted in the above case. Also
identify the dimension of business environment highlighted above.
16. The Indian companies after the year 1991 have especially paid attention to the need of having a manpower which
can adjust to the changing competitive environment. The new market situations require employees with greater
talent and higher level of competence.
In the above paragraph which one important impact of Government policy change on business is highlighted’?
17. With the abolition of licensing requirements a company has decided to enter into a new industry and the government's

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XII BUSINESS STUDIES(CASE STUDIES) (GA) 12
support is making the movements of goods easier. The company has lost its foothold in the previous industry in
which it was once a leader. All this happened because of the opposition of a project which the company had
undertaken in a village. The villagers started to gather and the incidence caught the attention of media. There were
protests and the result was ; the closure of the plant. The biggest competitor of the company wanted to ensure that
they gain from this situation. They started their vigorous efforts to increase their business output. This company
knows that all the inputs are the resources from the outside environment and they have to be converted into
successful products. Five years back the company used to make products which used to suit its production
requirements. Now it has decided to manufacture products according to the requirements of the potential custom-
ers. The product can only reach customers in the best possible manner only if the company prepares itself. For this
the company invests a lot in its employees so that they can meet the best standards of providing services which suit
the customers. The revenue of the company can decline in the next few years. The reason for this could be the
different types of innovative practices involved by various competitors in producing goods with the latest technol-
ogy. For this the company will have to prepare itself.
Which economic reform is highlighted in the initial lines of the above case? ‘Which dimension of business is
affected here in the initial lines of the passage? Which importance of business environment is highlighted here?
Name three different types of impacts of government policy changes on business and industry you can find here.
18. It’ s high time that the government should finaiise the industrial and monetary policies. The various economic
indices like national income, per capita income, rate of savings and investment, etc. should be taken care of while
deciding any economic plans for future.
Which concept can be seen discussed in the above paragraph?
19. ABCDE Ltd. has opened a customized shoe business in 23 cities. The organisation has done a lot of research on
the nature of business environment in which it is doing business. The market has fragmented as there are many
players, brand loyalties of the customers keep on changing, customers are. more demanding and there is intense
competition in the market. Every week onsSaturdaysthe board of directors sits for a meeting and decides the
future course of action. They rely on their surveys and past performances of other companies to achieve policy
making and deciding future course of action. The company devotes its lot of time in understanding the external
environment. With all the research the company has realised that the business environment does tend to have a lot
of impact on the organisation so it is necessary to continuously monitor it.
Name the various importance of management highlighted above?
20. A greeting card making company in USA is flourishing well. The company makes cards for different occasions.
During the time of Christmas and New Year, the production and selling of cards reaches a new high. The company
exists in an environment which is democratic and there are rules for every business firm. Once you step out of the
company there are customers, competitors, government authority and almost everything one can think of. The
company appears to have a promising future. However the firm will have to understand the close relationship
between various elements of the business environment around it.
In the above case which dimension of business environment is highlighted? Which features of business environ-
ment are highlighted in the above case?
21. ‘Raise the Bar’ is a sports equipment company. It has different branches in different parts of the world. However,
the requirements of the sports equipments are different in different branches. This is due to the change in cultures
and lifestyles of people in the different countries. The market in which it is dealing is known for awareness of
health. The more the awareness the more is the demand for such equipments. Company knows that the demand
for these products is unpredictable asnewdesigns keep on coming and the industry keeps on changing frequently.
There is a Research and Development Department which keeps on updating the equipments; in materials and
design. However the outside business environment is characterized pi by changing customer preferences, entry of
new competitors making it change. A meeting was organized recently to understand the external business environ-
ment. However, after the meeting it was realised that business environment can't be understood in totality it can
only be understood by breaking it into its dimensions.
The result of a successful meeting could be seen later in the performance of the company which created record
sales in the coming year.
Identify the features of business environment highlighted here.
22. GHI Private Ltd. is concerned about the external environment of business. It is busy analyzing various factors
which are going to affect its business. However with a lot of understanding it developed about the business it found
two types of factors; one which affected the firm directly and the other which affected all the firms in the
business. With the passage of time the challenges for the company have increased. The company finds new
competitors and technological challenges which are posing new changes for it. The company at the end of the
year decides to have a survey. This survey is about knowing the business environment properly. Even after
spending a lot of money on the surveys the company comes to conclusion that it's not easy to understand the

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XII BUSINESS STUDIES(CASE STUDIES) (GA) 13
business environment and it is properly understood only in parts. The company is ready to seek advice from
experts and is eager to notice changes in the business environment. “Then a multinational company enters the
market the company is eager in taking preventive measures like improving the product, aggressive advertising, etc.
A special team of experts have been created. The team observes the changes taking place like changing branding
loyalty, more demanding customers, etc. as it knows the pace of change is more important than the change itself.
The painstaking efforts of the company don't go unrewarded. The company by the end of the year makes huge
profit and by understanding the business environment is able to increase its revenue.
Which features of business environment have been highlighted in the above case? Also identify the various impor-
tance of business environment highlighted above.
23. Identify the dimensions of business environment in the following cases:
a) Hand-woven carpets are banned in some European countries as they think there can be involvement of child
labour in the manufacturing of these carpets. Products produced through the involvement of child labour are
banned in these countries.
b) With the winning of a new party in a particular country an automobile company has decided to take back its
plan of opening 15 plants in that country.
c) In the month of October a greeting card manufacturing company has decided to increase its scale of production
of New Year Greeting Cards.
d) A chocolate making company has decided to make more sweetened chocolates for people living in a particular
country.
e) A super bike producing company has decided to withdraw its earlier proposal of opening 10 new plants in a
country as it finds the per capita income of that country too low to purchase its bikes in large numbers.
f) Advertising of a particular brand is taken back as it is expected to hurt the sentiments of a particular section of
society. The company takes this decision on a conscientious level.
24. ‘On Your Marks’ is a good shoe manufacturing company. The company is the first to start a shoe having a unique
technology giving it a long life. However the company knows that it exists in an environment where everything
around it counts; so everything around it matters. Therefore, it is trying to observe every small aspect of the
business environment. There are various factors which are closely related to each other and can't be understood
in isolation like change in lifestyle can be linked to the improved demand of technologically advanced shoes. can't
be self satisfied. It will have to adjust to rapidly changing of market, changing brand loyalties, etc. It has got good
man and afvery “well established production department. It knows that various resources in the form of inputs
have to be transformed into the best products and sold for increasing its revenue. However, there are various
challenges which the company is facing. These are in the form of protests done by labour unions throughout the
country which sometimes assume the form of strikes. The board of directors is keen to adapt to this difficult
situation. Government is playing a very positive role, like it did a few years back, and is freeing the business
environment from unnecessary restrictions and government controls. The company is hopeful of emerging as a
winner under such government support.
Which features of business environment are highlighted in the above case?
Identify the importance of business environment highlighted in the above case?
Which dimension of business environment is highlighted above?
Which economic reform is discussed in the last part of the case?
25. ‘Runners Ahead’ is an emerging software consultancy company. The company finds its business affected by
customers, competitors, tax taking authorities in a specific manner but political, social and economic conditions
affect it in a general way. The company has decided to prepare an emergency plan to meet unpredictable chal-
lenges which change the business in a very fast manner particularly in the field of Information Technology. The
changes in the IT sector are very fast. So the chances of success are high; like in the case of new software
launched where the company has the advantage of entering the market early. However, things are not so easy.
Every time circumstances pose new challenges. The organisation has desided to monitor the external business
environment so that it can adopt suitable measures to inerease its client base.
Recently the company has been given a profect by the government to study and analyse its new policy. The poiicy
of the government is to give a bigger role to the private sector by reducing its own role in the Public Sector
Undertakings.
In order, to meet new challenges the company has to exploit various aspects of business. Recently it has invented
a new type ofeadvaneed for social networking sites for the aged people catering to their specificineetisi The
company is expecting huge rise in its revenue through the help of this project.
Which features of business environment is highlighted in the above case?
Identify the importance of business environment highlighted in the above case.
Which economic reform is highlighted in the above case in the second paragraph of the above case?

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XII BUSINESS STUDIES(CASE STUDIES) (GA) 14
Which dimension of business environment is highlighted in the above case?
26. ‘Shaktishali Steel’ is a steel manufacturing company. The owner's brother is a director in a public -sector under-
taking. He advises his brother to make his company run properly otherwise they can also face the same result
which less performing PSU's have faced. The Public Sector Undertakings now have changed and are trying to
generate high revenues for their own functioning, as the government support has declined.
In the above case which impact of government policy changes on business has been highlighted?
27. After the adoption of various economic reforms by the Indian government, the business scenario in the country
has changed. Earlier, the firms used to produce first and go to the market for sale later. But now-a-days firms
analyse the needs and wants of the consumers first and then produce goods accordingly.
Identify the impact of government policy changes on business and industry in India, mentioned in the above case.
28. Identify the dimensions of Business Environment in the following cases:
a) The demonetisation move of the government has resulted in the accumulation of lakhs of crores of rupees in
the banks. Now the banks will give more loans to the people at lower interest rate. General public can now
afford home loans more easily.
b) Small business will now move towards transaction of business affairs in plastic money. This will lead to use of
internet, new gadets, etc. and reduce dependence on cash. Report generation of these transactions will be
helpful in acting as proof for the betterment of future business.

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