Concept Of Business Environment In Nigeria

Concept Of Business Environment In Nigeria

In the Nigerian business environment there are various factors that holds sway, factors which most people will referred to as “The Nigerian factors”. Factors such as power outage, instability in government policy etc. However, there are basic concept of business environment, that these are the factors we will be discussing on this articles, below are some of the factors to be discussed.

External Environment Concept

As noted in our article “Business In Nigeria” the external/macro environment exerts significance influences on entrepreneurial activities either positively or negatively. As a result, entrepreneurs must pay serious attention to the forces that constitute their external environment, especially as the environments are beyond the boundaries of their control, are evolving, unstable and turbulent.

Though the entrepreneurs do not have immediate and direct control of the forces of the external environment, the forces must be identified, studied, prepared for and aligned with in order to remain creative and innovative. The ALI-PEST environments are here examined in details.

The Act Of God Environment Concept

By act of God is referred to those factors provided by nature or created by God that affect entrepreneurial activities. These include flood, fire disaster, tornadoes, landslide, earthquake, and so on.

The occurrences of any of these events negatively affect some entrepreneurial activities and yet spark off entrepreneurial activities for some others. In Nigeria, flood and fire outbreaks in some communities and cities usually cripple entrepreneurial activities as it exerts opportunities for some other entrepreneurs.

Legal Environment Concept

In every country there are usually legislation, foreign trade regulations, taxation policies, employment laws, environmental protection laws and other operational laws that regulate, protect and guide entrepreneurial activities. Therefore, entrepreneurs ought to be abreast of nature of the legal system, legal requirements of registration, formation, expansion, employment, lay-off, dismissal, taxation, patent rights and copyrights laws, monopolies to government regulations and protections of entrepreneurial activities creates sustainable business opportunities as well as societal acceptance of entrepreneurs. This is so because the laws, rules and regulations specify required actions and as well state punishment for transgressors.

International Environment Concept

The international environment refers to the business activities of organisations, groups, institutions, agencies and indeed entrepreneurs in countries other than the host country. The international environment includes legal and political trends, socio-cultural activities, economic and technological developments in other countries of the world.

The knowledge of the internal environment is important to the entrepreneurs especially as the world has become a global village occasioned by the recent developments in information communication and technology (ICT) and globalization. Consequently, entrepreneurial activities in one village within the globe have tremendous effect on other villages within the globe. For instance, the activities of Tim Berners-Lee hardly a household name, yet he invented something we now use as an indispensable everyday too, the World Wide Web (www).

Be it subtle or obvious, influence spreads through networks of information, knowledge and power to challenge norms and spark change. Changes as it were, reduce value of existing products or services as they introduce new and more acceptable versions of the products and services. Entrepreneurs, therefore, show interest in international environment because ICT has help to collapse boundaries of entrepreneurial activities.