The Global Business Environment Essay Example | Topics and Well Written Essays - 2500 words

The Global Business Environment - Essay ExampleThe environment in which Toyota operates is becoming extremely tough both day. All businesses are facing problems today due to increase costs, cultural diversity, globalization and decrease in global demand. The world has seen a great monetary crisis in recent years and economies are still to recover from it fully. In such environment companies are finding it hard to produce and sell its inter function point to customers. The external environment is also affecting organizations in new ways because media and communication technology has developed so much and any ethical unblock can seriously hurt the reputation of the company. Competition is also increasing in business environment as companies are trying to innovate and mart their products in better ways. In this report we pass on conduct an external environmental analysis for Toyota. We will talk about markets, competition and regulations that can call for an impact on the company . The ethical issues, corporate social responsibility and environmental policy and its affect on Toyota will also be discussed. This paper will deal with the external environment and not with the strategy of Toyota. Markets, Competition and Regulation Markets are evolving at a great pace in todays fast moving world and it is important to keep in mind the changing demand of marker market. Competition is also increasing as companies are trying to increase efficiency by decreasing costs and improving quality of their products. Regulations are also getting stern everyday and automobile companies collapse to keep in mind the safety standards set by the companies. This means increase in testing of cars which will lead to greater costs. In this section the impact of markets, competition and regulation on Toyota will be discussed. Markets and its Impact of Toyota The main target market of Toyota is the middle class income group of the world. These are the tribe who cannot afford luxuriou s cars but want vehicles that are cheap but durable vehicles. Toyota provides cars to middle income people of the world and prices are also lower in comparison to BMW and Mercedes. Over the years this target market has been consisted as they cannot switch to expensive cars and they also dont switch to cheaper manufacturers. This is why this market of Toyota was considered comparative safe and loyal to Toyota. But this is changing because now the target market of Toyota is also evolving. The target market is demanding innovation in designs and specifications. The medium income group target market has become more aware of the different brands in the market. They have also become more design oriented and are demanding newer and better designs. auto movies and games have informed the market about fast cars and sleek designs therefore they want these things in their cars. This problem is staring Toyota in the face because design was never a strong point of the company and its focus was on durability and prices. Evolving markets are in this way impacting the business strategy of Toyota. The main strategy of Toyota is that of reduce service costs by giving customers quality and durability (Harrup & Janssens, 2008). This is causing problems because the markets of Toyota are evolving and they are demanding better designs from the company. The external environment is therefore impacting the strategy of Toyota. The increasing focus on design and specification of the market can decrease the demand of Toyota cars. Customers will look for new car manufacturers