5.4 Macro Level

Figure 5.3: Macro Level outside factors

5.4 Macro Level

	Macro level encompasses the outside factors that organizations are faced with. These include culture and ethics, competition, politics and economic climate.
	This is illustrated in Figure 5.3.
	Culture & Ethics

Understanding the culture the business operates in is a key factor for the success of the business.

			Global businesses have to realize the importance of being culture sensitive and adaptive.
			This is because they operate in different regions around the world.

		One thing accepted in one country or region may be classifies as a taboo in another.
		A related issue is ethics.

The organization for instance does not want to trade a product/service that is seen to be unethical in a particular culture.

These may include alcohol and weapon products.

			Ethics can also cover religious belief.
			IS formulate this understanding in a more structured and logical manner where they aid in collecting and processing data of information about every region.

5.4 Macro Level

Politics

		Political powers and circumstances may influence a business entity.
		Political instability may cause a business the inability to use and apply certain IS. For example, internet use may be restricted temporary or even permanently.

			The use of mobile phone may be unstable due to bad network coverage for instance.
			Otherwise, there could be some legal requirements on attaining permission to use certain types of IS – software applications for example have to be sought from certain purchasing points.
			Yet again the business has to be adaptive and well informed of the political situation of the regions they function in, and be able to adjust IS applied accordingly.

Economic Climate

		Organizations attaining a good understanding of supply and demand issues in the regions they operate in is essential.
		This allows them to plan ahead, be prepared for market fluctuations, serve customers in a better way with no increased cost for the business itself.

5.4 Macro Level

		Weighing supply and demand is a basic economic concept that has severe implications on the success or failure of a business.
		IS can be a strong tool that helps collect the relevant data, analyze the data and make decisions on the most appropriate scale of trading for the business in the different regions covered.
		Understanding the economic climate allows for better management of the financial position of the company.

Competition

		Organizations operate in business environments where there are competitors.
		These can be direct competitors who supply similar products/services. They may also be indirect competitors who supply a substitute product to the business’s products.
		Being aware of the other businesses around motivates the business to maintain a good product/service and enhances continuous review and development.
		Businesses may even compete on the level of effectiveness and efficiency of the IS applied in their businesses especially in the global markets organizations operate in.
		Potential competitors and new entrants to the market should also be bore in mind.