The Business Environment Of Mittal Steel Commerce Essay

CEO Lakshmi Mittals household owned 88 % of the company. Mittal Steel was based in Rotterdam but, managed from London by Mittal and his boy Aditya. It was formed when Ispat International N.V. acquired LNM Holdings N.V. ( both were already controlled by Lakshmi Mittal ) and merged with International Steel Group Inc. ( the leftovers of Bethlehem Steel, Republic Steel and LTV Steel ) in 2004. On 25 June 2006, Mittal Steel decided to unify with Arcelor, with the new company to be called Arcelor Mittal. The amalgamation has been successfully approved by stockholders and managers of Arcelor doing L.N. Mittal the largest steel shaper in the universe.

Environment refers to the milieus. The administration is surrounded by assorted disputing factors. These factors stand as the fencing wall to the concern or the organisation. All the organisations irrespective of their size, and the type of the merchandise manufactured by them are surrounded by such factors. Therefore concern environment refers to the environment by which a concern is surrounded.

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Business environment is defined as the factors exogenic to the place environment of the organisation act uponing determination doing on resource usage and capablenesss. These factors include the political, societal, economic and technological environments.

All the organisations possess an internal every bit good as the external environment. An organisation can non hold control over the external environment their success depends upon how good they adapt themselves to their external environment. The internal environment is in the custodies of the organisation and can be controlled. But many a times the internal environment airss serious jobs to the organisations when the organisation does non concentrate on all the internal factors.

The amount of all the activities right from the procurance of natural stuff to the bringing of the finished merchandise is called as concern. The concern activities include production, finance, insurance, selling, etc. , the legal facets sing conformity with the authorities ordinances and the discharge of the duties to persons or groups is besides addressed because concern is for the people.

The survey of the concern environmental factors is of import for all the organisations. This is because if the organisation formulates the scheme without holding a clear image of the environmental factors so it is certain that the scheme therefore formulated may neglect.

An organisation is surrounded by both the internal concern environment and the external concern environment.


The internal environment refers to the conditions, events, and the factors within an organisation which influence the concern activities, peculiarly those of the employees.

The ends and aims, direction construction, relationship among the assorted components, physical assets, engineering, and the resources form the internal environment of an organisation.

Goals are frequently referred to as the statements that describe what the undertaking is ought to accomplish.

Aims are lower degree statements that describe the particular, touchable merchandises and deliverables that the undertaking will present.

Physical assets refer to the machinery that is used to fabricate the planned merchandises. The other types of the physical assets are the edifices. It means that there should be some country where the activities are performed i.e. , transforming the natural stuffs into the finished goods signifier.

Technology is the manner which helps an organisation to transport out its operations at a faster gait. The engineering may be implemented in the assorted resources of an organisation at assorted degrees.

Resources are the natural stuff, or the labor which contribute to the practical deduction of the scheme in aid in accomplishing the set ends and aims.


The external environment is a combination of both the micro and the macro concern environments. The micro environment is that environment which includes the assorted factors such as the providers, workers, clients, mediators, rivals and the general populace.

The macro environment is divided into economic and non-economic activities. The economic activities are farther divided into national and planetary environment. It is really indispensable to see all the activities into planetary picturesque because of the planetary engagement. Those organisations which are be aftering to do investings in foreign states should decently understand the planetary scenarios efficaciously and expeditiously and hence this should be implemented for their scheme preparation. The non economic environment includes assorted factors such as the political, societal, economic and technological factors.

The macro environment refers to all those factors which exercise their influence on the concern activity. The function of micro environment may be either positive or negative. This proves that the larger forces in the company ‘s environment do non ever supply wider infinite for concern activities.

The political factors are those factors which arise from the political construction in an economic system. The political factors pose challenges to an organisation because the political policies keep altering when a new authorities is formed. So, the organisation should be capable plenty to get by with those political policies and formulate their schemes harmonizing to those policies. Business growing depends on the political environmental factors. If the environment is contributing so merely the concern will boom. There is ever an component of hazard associated with these political factors. Hazard could be in footings of the type of the authorities in power and its concern policies, perceptual experience in affairs of foreign investing and how it regulates the market. The concern organisation therefore has to maintain in head the political facet while doing a raid into the market or it has to confront the political hazards.

Social factors are those factors which arise because of the society. An organisation becomes a portion of the society as it serves and manufactures the merchandises and services that are required by the society. The organisation should transport out assorted public assistance activities which prove good to the society. The organisation should predate the construct of entirely concentrating on net income maximization. Both the society and the organisation get benefitted from each other.the concern possesses a societal duty. The assorted societal factors are the civilization, values, gustatory sensations, penchants and so on and all of these must be addressed by the concern organisation as concern is for the people.

The economic factors are those factors that determine the buying power, the life criterions, the economic conditions such as recession, rising prices and assorted factors which have an impact on the buying capacity of the consumers.

The Technological factor: Each twenty-four hours brings a new engineering, and the old 1s go disused. Technology makes the concern simple. The authorities has realised the importance and so policies refering different facets of the engineering have been formed. Business directors should maintain abreast of the rapid altering technological alterations, because this information is critical for its operation.


The assorted strategic direction tools that are available to explicate an effectual and efficient scheme are as follows:

Critical Question Analysis

SWOT Analysis

Business Portfolio Analysis

Porter ‘s theoretical account For Business Analysis

Resource based Model.

Of these all the SWOT ANALYSIS is the largely used strategic preparation tool.

Many organisations have implemented the SWOT analysis and achieved the success and reaped the benefits of the SWOT analysis.


The term grind bases for strength, failing, chance and menace. The swot analysis is the of import strategic tool that is used to explicate the scheme in an organisation. This analysis helps the organisation to place its strengths. The strengths of an organisation are the success that the organisation has tasted before. An organisation ‘s strength may be its direction, its employees or its resources. It is therefore considered that the successful organisations identify their strengths correct their failings, grab the chances that are available and present a challenge to the menaces. The organisation should hold the resources to excel their failures or the failings. The failing of an organisation may be because of assorted factors such as the improper direction, non- handiness of the resources, etc. , the organisation should be able to implement stringent regulations which should assist in transporting out the proper activities all through the organisation and finish the vision undertakings. the chances for an organisation assist them to do a grade for them in the market. Largely the failings of an organisation ‘s rivals are its chances. The organisation should place its rival ‘s failing and transform those failing into their strengths by work outing those failings. The menaces that arise in the concern environment may be because of assorted political, societal, economic and technological factors. If the organisation uses the out-of-date engineering so it lacks back and here comes the opportunities for its rivals to stamp down them. The swot analysis helps to place the strengths, failings, chances and the menaces and fulfill the demands of the markets and run into the outlooks of their stakeholders.


Scheme is defined as the tool by which the aims consciously and consistently pursued and obtained over clip. The word scheme is derived from the Grecian word STRATOS- significance ground forces and AGO- significance guiding. It is referred to as the art of analyzing and directing. Strategy is non the act of be aftering it deals with covering with the unmanageable factors. The five cardinal elements that have to be considered while explicating the scheme are mission, clime, land, leading and the methods. The scheme technique is used in all the Fieldss. It attracts a dressed ore in the concern field because scheme Acts of the Apostless as the usher to organisation in the procedure of accomplishing the set ends and the aims. It will be really much impossible for the organisation immediately get down the procedure of accomplishing the organisational ends and aims without a proper methodological analysis. The scheme helps the organisation and order the assorted ways through which the organisation can accomplish the ends and the aims. The concern activities are ever viewed as a group undertaking but non as an single undertaking. Group work is considered to be the efficient one instead than the single one as the thoughts generated in a group are more when compared to single one. The group undertaking besides helps to make the construct of specialization. This helps to accomplish the set ends at a faster gait instead than decelerating down the whole procedure. The organisations in these yearss are seeking to present the goods to clients before the proposed clip. This is doing a big per centum of clients to trust on the organisation to fulfill their demands. There are assorted events that disturb the scheme after it is formulated and put into pattern. So the organisation should maintain this construct in head and embracing these factors at the clip of planing of the organisation ‘s scheme.

All these undertakings are possible merely when the organisation ‘s direction possesses the managerial maps of planning, organizing, staffing, taking, and commanding.

The construct of strategic direction has evolved to do the strategic preparation procedure an easier one. Strategic direction may be defined as the behavior of drafting, implementing, and measuring transverse functional determinations that will enable an organisation to accomplish its long term aims. By and large the organisations opt for long term aims than the shorter 1s as they can prolong in the market by supplying advanced merchandises and services to the people by fulfilling the demands of the markets. This manner they can spread out their activities by puting up assorted subdivisions which offers them to take part in the primary and the secondary capital markets which helps them to run into the outlooks of their stakeholders.

What is a market?

Market is defined as the group of consumers or organisations that are interested in the merchandise, has the resources to buy the merchandise, and is permitted by the jurisprudence and other ordinances to get the merchandise.

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The outermost most rings refer to the possible market. This possible market consists of that population who show involvement towards purchasing a merchandise. The interior ring in side the possible market consists of that population who have the currency to purchase the peculiar merchandise available in the market. The qualified available market is that market in which the consumers are quailed to buy the merchandise. Here the clients should possess the legality to purchase a merchandise. For illustration if a client is interested in purchasing weaponries and ammo foremost he should hold adequate money to purchase those weaponries and ammo and he can achieve the legality to by the same by possessing an weaponries and ammo licence. The mark market is that topographic point which an organisation has selected and has produced the merchandises and services which are preferred by the consumers in that country. This cleavage is done because of the handiness of assorted merchandises and services in the market which are used for assorted intents. The inmost circle or the bed is the penetrated market where the client buys the merchandises and the services.

It proves healthy for the organisation to concentrate on the mark markets instead than one as there are opportunities of hazard originating in the hereafter. If the organisation concentrates on assorted markets it will go easier for the organisation to distribute or portion the hazard load.

Who are stakeholders?

Stakeholders are the people or the groups that have an investing, portion, or involvement in a concern or industry. Stakeholders of a company or an organisation include shareholders, bondholders, clients, providers, employees


Stockholders or the stockholders are the 1 who own stock in an organisation. There are different types of portion holders such as equity, penchant or a combination of both. The stockholders own few portion of the organisation and are eligible to acquire paid certain sum of the involvement on at the in agreement intervals. Normally, the involvement is paid out of the net income earned by the organisation.

Chemical bond holders

In fiscal construct a bond is defined as a fiscal security. A bond is like a loan. On the adulthood of the bond the rule sum is paid. The bond issuer is besides apt to pay some involvement to the issue. The characteristics of a bond are that it possess some pecuniary value.the rule sum of the bond reflects its pecuniary value. The bond possesses a adulthood day of the month ; the bond holder is apt to have some involvement based on the involvement rate or the voucher rate.


Customers are those who buy the merchandises and services of the organisation. The client plays a really critical function as they are the intent of the concern. If there are no clients for a peculiar merchandise so it is a loss to the organisation which produces such merchandise. Thus the organisation should carry on assorted activities to cognize the penchants and the demands if the clients and they should besides seek to accomplish client satisfaction by presenting advanced characteristics to the already bing merchandise or seek to present new merchandises. The organisations should give much importance to client keeping excessively.


Suppliers are the people or the organisations that supply or sell the assorted natural stuffs required by the organisation for the fabrication procedure. It is really much of import to run into the outlooks of the providers as they supply the resources which are indispensable to accomplish the set aims. The organisation should pay the sum to their creditors on clip so that they provide the recognition to but the needed natural stuffs from their providers.


Employees are the people who work in an organisation. These are the people who apply their accomplishments to put to death the scheme therefore formulated to accomplish the set ends. The organisations should ever endeavor for improvement to make an environment for its employees which inculcates some involvement in them to make some work. They should pay extra to the employees who have spent excess hours of production. The organisation should develop the employees and promote the employees by honoring them. Few organisations give some portions to the employees who are treasures and seek many ways to retain them.


The organisations should follow the strategic direction policies for the preparation of an effectual and efficient scheme and should besides possess all the resources which are required in put to deathing the scheme for the accomplishment of the set ends and aims which have been formulated based on the vision and the mission of an organisation.

The assorted strategic preparation tools helps an organisation to explicate a scheme which have the opportunities of less defects and which minimizes the hazard that an organisation is ought to confront. The market hazard is the hazard which crops up with the improper strategic preparation. Furthermore, the organisation should clearly understand all the concern environmental factors which disturb the organisation. All these factors do non stay dead as there is possibility of the alterations that occur every twenty-four hours. So, the organisation should and must maintain all the alterations that may take topographic point in future or in that clip which is taken to put to death the formulated scheme. The political, societal, economic and the technological factors differ from state and state and there is a demand for all the organisations to understand these factors non merely at a domestic degree but besides at the planetary degree if they are be aftering to spread out and set up themselves into the planetary market and to provide the demands of the planetary markets and run into the outlooks of their stakeholders. So all these tools help the organisation to construct a strong scheme and make a niche by bing for long tally in the market.

All these factors transform into presenting challenge to all the organisations is merely because of one construct i.e. , CHANGE. The alteration is the construct that makes the organisations to present advanced strategic preparation techniques. This is that major construct which makes the organisations to bring forth new merchandises and services by fulfilling the clients and retain them. The alteration construct is natural and nil can halt it. The alteration factor is governable merely at certain degree ; beyond that degree nil can halt it. The alteration is the factor driven by we the PEOPLE. Because of the impermanent construct. Nothing is lasting in this universe. The alteration construct arises because of the failing, the disadvantage or the demerits of a merchandise. So the organisation should instill the characteristics that are taking topographic point in an organisation ‘s scheme formulating procedure. Furthermore the organisation ‘s scheme preparation policy should instill the flexible features. All the organisations should instill the adaptability characteristic in them. This helps them to easy understand the alterations that takes topographic point around them and explicate a scheme by maintaining in head all those altering and disputing concern environment factors.


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