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31726035 Social and Cultural Environment

31726035 Social and Cultural Environment

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Published by: werewolf120 on Aug 22, 2011
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Social and Cultural Environment


Social and Cultural Environment 

Business is an integral part of the social system. Social factors are among the most important factors which affect business. The type of products to be manufactured and marketed, the marketing strategies to be employed, the way the business should be organized and governed, the value and norms it should adhere to etc. all influenced by the social structure and culture of a society.


What is Culture? 

Culture may be defined as the behaviour of man as a member of society. It is the habit acquired by belief, knowledge of arts, moral, law and It is socially sanctioned behaviour of people.


Cultural Factors/ Social Structure 4 .

Many business decisions in India and in several other countries are based on astrological advices. festivals etc. customs. Religion also play a role in deciding in weekly holiday. beliefs. 5 . other holidays and working hours.Religion and Caste      Different people have their own religious convictions. Religion may also influence the attitude towards work and wealth. The cost of ignoring certain religious aspects could be effect organizational existence in international business. rituals. sentiments.

Non-verbal communications create equally perhaps even more difficult problems.Language    Differences in the language is a very important problem area in business. Same words of a language have different meanings or connotations in different places. 6 .

Beliefs. The values and beliefs associated with colour vary significantly between different cultures. Habits. 7 . Consumption habits and demand patterns vary greatly from one market to another. Many companies modify their products and promotion strategies to suite the tastes and preferences or other characteristics of the population of the different countries.Consume preferences. Consumption     What is liked by people of one culture may not be liked by those of other culture.

8 . With big families being broken up. Concerns itself with love. Women now enjoy equal status with men and most of them supplement family income by their own earnings. socialization of the child etc. marriage. family businesses are slowly turning into limited companies.Family System       Family is a social institution. sexual relationship. Children have become spenders instead of earners. Nuclear families have now become common in our society replacing the traditional joint family system.

naming ceremony of child. 9 . consumer durables etc. dress sense etc. These have implications for many types of business like textiles. catering. festivals.Customs   The customs of marriage. have significant effect on business. jewellery.

death rates were less on account of improved diets. and improvement of transport.Demographic Transition     In the first stage of transition. death rates were high on account of poor diets and absence of effective medical aid. In the third stage of transition people started to shift from rural areas to industrial and commercial centers. In the second stage. wage policy etc. These changes affect the business organizations interms of availability of skilled labour. 10 .

Savings    Savings habits of consumer also affect the organization. Increased saving habits of the consumer leads to the capital formation and even it boosts the banking sector. 11 . It may favorably affect some organization and on the other hand it may adversely affect the other business organization.

12 .Etiquettes  The ways of meeting and greeting people methods of showing respect. ways of conducting meetings etc affect business organization.

it is obvious that certain old elements are dropped as new ideas and traits are aquired. teachers and other elders. Many cultural bahaviours are handed down by one·s parents.Cultural Transmission    The elements of culture are transmitted among the members of the society . from one generation to the next and to new the new members admitted into the family. In the cultural transition. 13 .

Impact of Culture on Business 14 .

vary from culture to culture and from time to time with in the same culture. the clothes they wear.1. Culture determines Goods and Services   Culture broadly determines the type of goods and services a business should produce. the beverages they drink and the building material they use. 15 . The type of food people eat.

2. 16 . People·s attitude are based on how well business contribute to society. Business systems are a product of beliefs and customs of society in which they exist. People·s attitude to Business    Attitude of people towards business is largely determined by their culture.

Attitude to Work  Motivation.3. morale and other related aspects of human resource management are based on the workers attitude to their work. 17 .

4. Culture creates people  The concept of culture is of great significance to business because it is the culture which generally determines the activities of the people  18 .

5. multiplicity of trade unions and inter and intra-union rivalries. 19 . It is said that ´ our culture Stresses individualism. Collectivism and Individualism   The spirit of collectivism and individualism is related to such personnel aspects as employee morale.

Ambitions and complacent   An individuals ambition to grow or remain complacent depends on cultural factors. Majority of our people are know to be complacent.6. 20 .

Education is considered as one of the social overheads that has been accorded due priority among the developmental activities. Education    The close interface of business and higher education is a new development. 21 .7. Industrial societies of today are knowledge and Educational oriented.

the business people should have a thorough knowledge of the cultural environment.´ In order to effectively adopt.µ  This will be useful to the management of the business in several ways- 22 . create and also to confirm a culture.

the businessmen can easily predict their future behaviour in the event of introducing a new product.   People generally are conditioned to behave in a particular way and perform their work in a particular method. by observing their cultural background. So awareness of their culture will help to understand their behaviour and conduct. Awareness of cultural background will enable the business to quickly change the product to suit the needs o the changing soviety. 23 .

This will help in making quick decisions. The business managers should develop a sensitivity to the culture of the society in which they operate. 24 .

 Being so much dependent. men. and encouragement.  Business depends on society for existence. and skills.Social responsibility of Business Business depends on the society on the society for the needed inputs like money.  25 . business has definite responsibility towards society. sustenance.

for the benefit of the societyµ 26 .What is Social Responsibility? ´ Obligation of business to take actions which protect and improve the welfare of society as a whole along with its own interestsµ ´ What business does. over and above the statutory requirement.

Social Responsibility in Business Early 20th Century Middle 20th Century Early 21st Century Maximize Profits Provide Jobs and Pay Taxes Balance Profits and Social Issues 27 .

Dimensions of Social Responsibilities 28 .

Social Responsibility Towards Stockholders     Protect the capital. 29 . Providing fair and reasonable return.1. Stability of dividend Transparency in the business operation.

2. Opportunity for workers participation management. in 30 . Providing good working conditions. Social Responsibility Towards Employees    Providing fair compensation.

Making arrangements for supply of goods and services. Satisfactory after sale services.Social Responsibility Towards Consumers     Strive to improve product quality. 31 .3. Providing goods and services at fair and competitive price.

Should not indulging in brand assassination 32 .4. Engaging in healthy competition. Social Responsibility Towards Competitors    Fair game in market.

Social Responsibility Towards Government    Conducting business according rules and regulations enacted by govt.5. Regular payment of various taxes. Providing required information from time to time. 33 .

34 . Development of backward areas. Providing employment and education opportunities. Conserving scarce resources. Assisting in overall development of the locality. Social Responsibility Towards Local Community       Preventing of environmental pollution. Promotion of small scale industries.6.

35 . regulation and intervention. Social involvement may create a better public image for the company which may help it in attracting customers. Social responsibility like recycling of waste may have favourable financial effects.Why Social Responsibility?     Social involvement of business would foster a harmonious and healthy relationship between the society and business to the mutual benefit of both. Social involvement may discourage additional govt.

Why Social Responsibility?   Business which survives using the resources of the society has a responsibility to the society. 36 . Business which is an integral part of the society has to care for the varied needs of the society.

Business ethics 37 .

It tells what is right and what is wrongµ 38 .What is ethics? ´ Ethics refers to the code of conduct that guides an individual in dealing with others.

What is Business ethics?
´ the term business ethics refer to the system of moral principles and rules of conduct applied to business.µ ´ Business ethics refer to the behaviour of the business man in his business situation. Where in the business man values certain norms as very important than other thingsµ


´ The most important business ethics is expressed by the Hippocratic oath of the Greek physician. i.e. ´Primum non nocereµ Which means that ´ business or professional should not knowingly harm the societyµ The code of conduct Primum non nocere encompasses various business ethics namely-



Do not cheat customers by selling substandard or defective products. Do not destroy the competition. Do not indulge in unfair trade practices like Grey marketing. Ensure sincerity and accuracy in advertising, labeling and packaging. Ensure prompt payment of wages and fair treatment to employees.


Refrain from secrete profits. Do not form an illegal organization and illegal agreement to control the production. Make accurate business records available to all authorized persons. 42 .    Pay taxes regularly and discharge obligations of the govt.

Economic Responsibilities. Corporate Responsibilities. 43 . Official Responsibility Personal Loyalties. Legal Responsibilities. Technical Morality.Types of Business ethics?        Personal Responsibility.

Moral sanctions 44 . Education and Persuasion.Role of Trade Associations ´ Voluntary organizations of businessmen and employees formed to promote their common interests.µ  Trade association can promote business ethics in three different way 1. 2. Code of Ethics 3.

having business ethics. and persuading them to give due regard to ethical principles in the conduct of their business. 45 . and the need of for.Education and Persuasion  Trade associations can promote business ethics by educating the members about the importance of.

Code of Ethics   Trade associations can formulate a code of conduct for their members. The code of conduct will not only guide but also regulate the conduct of business. 46 .

It may debar a member for a serious violation of the code of conduct. Trade associations may announce incentives to promote business ethics.Moral sanctions    ´sanctionsµ refer to the ways in which moral conduct rewarded or misconduct is punished. 47 .

b. Ethical decisions are difficult to make. They can not be programmed like production and inventory decisions.Problems in Business ethics   a. Some ethical standards vary with the passage of time. Knowledge about consequences of an action is limited. c. There are many reasons why business ethics is difficult to adoptManagers face dilemmas in deciding on a course of action. 48 .

Problems in Business ethics d. Individual differences. Difficult to match organisational loyalty to public interest 49 . e.

µ ´ Consumerism may simply be expressed as ¶let the seller beware· in comparison to the age ¶let the buyer beware· 50 .Consumerism ´ Social movement seeking to augment the rights and powers of the buyers in relation to sellers.

But in Modern days consumers have not only been called upon to pay higher price.Consumer Protection    In a free market economy. but have to settle for lower quality goods. 51 . duplicate and adulterated products. Thus the need for consumer protection has arised to protect the interest of the consumers. it is said that consumer is a king.

Consumer should be protected against the unfair trade practices. Protect consumers against pollution.      Consumer protection is essential for following reasonsConsumer should be protected against the products that are unsafe and unhealthy. 52 . To prevent exploitation of consumers from manufacturers. Protect consumers against restrictive trade practices or monopolies.

It was only in 1965 consumer movement started in India. Government Measures 53 . Consumerism in India can be explained in two pointsEstablishment of consumer Organization. Consumerism in India is of recent origin.Consumerism in India    1. 2.

Establishment of Consumer Organization        In the year 1965 housewives of Bombay established a voluntary consumer organization in the name of AWARE i. PRRM.Consumer education and research centre.e.Consumer guidance society of India. Consumer education centre Indian federation of consumer organization 54 . Association of Women Against Rising expenses.Price rise resistance movement CERO. Other organizations are ² CGSI.

Educating consumers Creating an awareness among consumers. 55 . To protect consumers from exploitation To maintain accuracy in weights.Establishment of Consumer Organization           These associations deal in three important areas likeConsumer protection Consumer education Representation Main objectives of these organizations areTo charge fair and reasonable prices.

Government measures can be classified intoEstablishment of public sector Statutory Regulation 56 .Government Measures   1. In India the government has taken number of measures to protect consumer interest. 2.

Establishment of Public Sector     Govt. improving efficiency in production. Improving the distribution system 57 . Curbing private monopolies. Making goods and services at fair prices. established many business unit to enhance the consumer welfare by increasing production.

supply. distribution.Statutory Regulation   Govt. price and quality of a large number of goods and services It enacted following acts to protect the consumers 58 . has armed it self with a number of statutory weapons to control the production.

      The sale of goods act 1930 Standards of weights and measurements act 1976 MRTP act 1969 Prevention of food adulteration act 1954 Fruit products order 1955 The consumer protection act 1986 59 .

Consumer organizations got success in creating awareness but failed in the field of consumer protection. 60 .Conclusion   There are several loopholes in the lows which are misused by the sellers in exploiting the consumers.

Consumer rights      Right to health and safety Right to be informed Right to choose Right to be heard. Right to seek redressal 61 .

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