Page 175 - DMGT401Business Environment

Business Environment

Notes 5. Offering Quality Products at Fair Prices: Business is all about creating customers, and the
customer can only be created when customers are satisfied. Customers can be satisfied
when they are provided with value-added products at fair prices, after sales services,
timely information, and when the product reaches the right customer, etc.
6. Environmental Protection: Industrialisation is doing much irreparable harm to the
environment. It is therefore an obligation on them to not only morally, but also legally
undo the damage by taking serious and responsible steps to protect the environment and
to keep it healthy condition.

They should adopt modern technology to ensure that their operations do not harm the
environment. Businesses should also take actions to educate their employees and people
about the environment in general.
7. Fair Trade Practices: Fair trade practices of business include:
(a) Avoidance of formation of cartels or following monopolistic practices.
(b) By creating shortages for the purpose of black marketing and speculation.
(c) By exaggerating and making false statements regarding claims.
(d) Not buying political favours to sway decisions in its favour.

(e) Following healthy competition with competitors by not indulging in industrial
espionage or other unethical means.
(f) Not deliberately making the organization sick to avoid obligations or to escape
from responsibilities.
(g) Not to involve in insider trading or to take undue advantage of inside information.
(h) Not bribing public servants and corrupting the democratic structure of the country.
(i) Paying taxes, duties and other dues honestly and on time.
(j) To provide required information to shareholders and all other stakeholders.

(k) Making timely payment of borrowings and interest.
(l) While dealing with suppliers, instead of using their bargaining power, corporations
should invest in good relations with them. This will help suppliers maintain quality
and develop new products for the organization. This may appear to be costly initially
but it ultimately pays. The Japanese usually believe in establishing a good rapport
with their suppliers.

(m) Not adopting a communication strategy that is not compliant with social norms.
(n) Business should abide by the laws of the land.
8. Local Development: Businesses use resources of the society are therefore responsible for
the development of their surrounding areas. A business can perform various functions to
develop its local area. In fact, if every business house takes responsibility of some villages,
miracles can happen in India.

Example: Business houses like Tata Chemicals, ITC and HLL are doing so. Cooperatives
like IFFCO are also following this concept. These business houses adopt some village and
construct roads, spread literacy, ensure health programmes, promote family planning and other
social reform programmes, help farmers in agriculture and marketing of their products, and
promote the handicraft and cottage industry of the villages. HLL is giving employment and
empowerment to the women of villages through its operation Shakti and ITC is revolutionising
the village distribution system through its e-choupal system.

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