The micro-environment is more important than you think
What is the micro-environment?
The micro-environment is everything that has to do with the internal affairs of the business. It is something that the company has complete control over and the micro-environment has a direct influence on your business. There are many components that make up the micro-environment and these all have a direct influence on how your company can meet the needs and wants of your consumers. Your company should have a business plan, a business mission, a target market and an allocation of resources and labour in order for you to have your micro-environment in order.
How to plan for your business.
Within the micro-environment, there are many components that need to come together in order for you to meet the needs of your customers. This is called your marketing strategy and this strategy will help point your company in the right direction.
Firstly, you need to create a mission statement for your business. A mission statement is a simple and concise declaration of your business's core purpose. Your statement should include your aims and values of your business. This will help set an end goal that you will continue to strive towards. This is also a promise to your consumers, so you need to make it clear and keep the value behind it.
Next you need to create your marketing objectives.These are specific smart (specific, measurable, attainable, relevant and time bound) goals that help your workforce achieve the mission statement that you have set for your business. A marketing objective can be many things. It can pertain to either a specific goal or multiple goals. They should not be vague, but should be very specific in order to be carried out effectively. They should relate to a result instead of an activity that should be performed. They should be challenging, but attainable at the same time and they should set within a time period. If you set your objectives within all of these boundaries, then you will be able to drive your workforce towards its goals and towards the mission statement.
Next, there need to be business or long term objectives. These include the whole enterprise and consist of many different aspects. These should consist of the following:
- Market standing: A business should decide what products and services it wants to sell and to whom it wishes to sell them.
- Productivity: This is the ratio of inputs and outputs of a business.
- Innovation: A business that plans to remain competitive in today’s environment should be innovative and plan for new products.
- Physical and financial resources: Objectives should be established with regard to plant equipment and supply of raw materials.
- Profitability: Profit is the reward for the capital investor or entrepreneur.
- Manager performance and development: Businesses should set objectives that relate to the quality of management performance.
- Worker performance and attitudes: Objectives should be set regarding factors such as output per employee and quality of the product.
- Public and social responsibility: Objectives should be set that will address the public and social responsibility initiatives.
There are also functional or short term objectives. These objectives are set by the functioning manager of the functional area. These objectives are as follows:
- Customer orientation
- Survival and growth
- Increase in sales and market share
- Efficiency motive
- Marketing instrument objectives.
If you follow all of these plans, you are bound to have a strong workforce that is well prepared and can meet all the goals and the mission statement.
Selecting your target market.
In order for your company to meet its objectives and goals, you need to find a target market that is big enough.Sometimes companies focus on niche markets, but the problem with this is that it is a market that is very small and has a particular taste for a particular product. If you were selling expensive sports cars, then you would be looking for a niche market. If you were selling knives and spoons, you would want a target market that has a great demand for your product. You need to develop your market strategy and your objectives around your target market so that you can get the maximum profits and consumers.
Control your resources and labour.
Your resources and labour or some of the more controlled aspects within the micro-environment. You need to allocate these variables responsibly in order for you to make a profit. Your resources include available capital and skills that are needed in order to be effective. If you can control all of your resources in a responsible manner, then you will be able to get the most out of your workforce for the lowest price. This is always the goal of a business
If you are able to create a mission plan that is simple and concise and if you are able to create your objectives while responsibly allocating your resources and labour, you will be able to have great control over your company and the micro-environment. This will help you with profits and customers and will help improve the image of your company.
All information was taken from the Marketing Management (A South African Perspective) textbook.
Can't, MC and Van Heerden, CH. (2013). Marketing management a South African perspective. Cape Town: Juta & Company Ltd.