Q. What are the ‘drivers’ and ‘influencers’ of business activity?  

A. It is all about the ‘environment’ in which the organisation exists and how it ‘reads‘ and responds to that environment (and how its existing and potential clients do too!).

Essentially the answer lies in changes occurring over time (hence the clock pic)  in a number of ‘environments’ (socio-cultural, technological, economic, natural, political, legal/regulatory, consumer & competitive) , which evoke responses from us in our professional & personal capacities and from governments & organisations.

This Block will be about:

1. researching these environments – what is happening now and is set to happen in the near and longer term futures? What trends and ‘megatrends‘ can you see/feel/predict?   This is a BIG open question faced by ALL businesses (and non-commercial organisations like associations, and, yes, universities!).
2. determining the impacts and implications (opportunities and threats) of these changes and trends for existing companies and organisations and identifying appropriate strategic responses (could be to develop new products or new markets or a more appealing environmentally-sensitive image or maybe simply to get out of the business, take the money and invest in something new entirely where growth can be found and not stagnation.
3. developing ideas for NEW products and services (commercial or public sector) which could well be needed, demanded and successful responses to the changes and trends identified.  Above all, new ideas, concepts, products and services that solve problems we already have are likely to be most successful. [In the following Block, you will find yourselves ‘pitching‘ your new product / service concept to potential funding sources in ‘The Dragons’ Den‘!  This will involve: What is the ‘big idea‘? Why this? Why now? Where’s the evidence of its feasibility and viability over a 5-year period. What is the growth profile?  Where is the break-even point?  What is the level of risk?  How attractive will it be for an investor?]

This may all seem a bit ‘abstract’, but it isn’t: Let me try to tell you a lttle more:

Let me give you a couple of examples.   …… Think for a minute………

• If you were in the Tourism and Travel industries what if there were an outbreak of H1N1 influenza in Paris and London…..? (NB. I wrote that before CoVid!  Read on in the knowledge of what covid has done and is still doing to the industry and may do again with every new variant!)  Would your American target market be likely to book a European tour?   If you dealt exclusively with Europe as a destination you could find yourself with virtually no business…..  (A social / health environmental factor / driver).  You will see that I certainly wrote this before CoVid hit!  But  just look at the damage it has done to the airlines, railways, destinations and resorts, hotels, theme parks, gites, restaurants. ….   It will also have hit the French Treasury VERY hard: France has the largest annual net tourism income in the world  …. but until summer 22 the international tourists had not come back… (partly compensated by the fact that more French people had little choice but to holiday in the Hexagone).  It will also hit the support industries hard: Tourism supports some 1.8million jobs directly AND 1.8 million jobs again indirectly.  That is 3.6 million jobs out of just 26 million people working or seeking work: nearly 14% of our jobs and nearly the same % again in terms of our GDP/PIB).    How does one cope with that?  Give up or fight to survive…?
• What about BREXIT – is that going to help Tourism to France by the British who are France’s biggest international market by far? (A political driver)
• Looking back for a minute, what gave rise to the dramatic growth of Low-Cost airlines…?   The sudden and largely unpredicted arrival of the internet.  It enabled such airlines to come into being and prosper without the need to print brochures and operate through a costly, commissioned network of agents/ intermediaries.  The technological innovation enabled the low cost sector to proliferate whilst the traditional airlines were ‘stuck’ with their traditional, costly, distribution network AND having, at the same time, to fund the development of their own internet presence.  (A technological ‘driver’).
• Who would have predicted in 2021 Russia prosecuting a war in the Ukraine from FEb ’22 with massive global impacts which we are all feeling [bar perhaps a few in the know in the CIA] ?  But even this is creating business opportunities for some…For example, as I write [Rentrée ’22] the price of diesel is far higher than E10 and [according to a BFM TV reportage] charging your electric car  costs 99Euros, whereas putting a full tank in your Hybrid costs ‘only‘ 88 Euros AND the 88Euros goes further, because the hybrid charges up its batteries from the recovered momentum of the car….  If one were a salesperson in a company like Toyota or Kia, I would imagine that this is giving you a significant  current competitive advantage…. (A major – politically driven – discontinuity)

These are just illustrations – they are FAR from representing all possible drivers…..  so, after the ‘Aside’ (A little, incidental digression) directly below, you will find further details and task instructions.

Clearly ‘CHANGE’ positive or negative can be the spur to threats but also to seize world-beating opportunities: as I tell you here:

——————————————————————————————————————————

[An ‘Aside’: Do you know where the internet came from / who developed the idea, where, why, when and how?  Exactly who came up with the idea and invented HTML code and links in a page?  An invention that introduced almost totally unpredicted change at a massive rate upon the world.   Think: it wasn’t so long ago – there was a moment where it didn’t exist – someone did something – it came into existence – the world depends upon it!  Imagine if you had to pay a penny every time you clicked on a link .. and how rich the inventor could have made himself.  Some clues for you:

1. France had a (sort of) ‘hand in it’
2. No, it wasn’t the American defense system or ARPANET!
3. There is a (very tenuous) connection to me and my wife and where we used to live in England
4. The idea emerged after an end of placement (fr: ‘stage‘) restaurant meal, lamenting the fact that a group of departing stagiaires would be out of real-time contact with one another and scattered all over the world rendering continued collaboration annoyingly difficult)
5. The idea came into being less than 300km from Mulhouse

Anybody know the story?

So, if a frustrating problem + a stagiaires meal = a world-changing moment…. surely anything is possible!

Did you know? The website and concept of Lastminute.com was developed by a pair of students [Martha Lane-Fox and Brent Hoberman] during the final year of their degree programme – not by two middle-aged business people with tons of experience and MBAs in their pocket! Now if thy can do it … what’s stopping you!?!

Did you know? For years the world’s largest online travel agent, EXPEDIA was NOT founded by a Tourism company seeing and seizing the opportunity to extend their expertise and expand their domestic markets globally in one shot -…. rather it was developed by a software company: Microsoft, who asked itself the Q: ‘OK, so we’ve got our brilliant web-browser – now what can we do with it and how can we make money out of it?’)… A case of a ‘blind’ Tourism industry not looking closely enough at the business environment to see the once-and-for-all, golden opportunity they were about to miss…

ASIDE. This reminds me of an old biblical line I remember from my sunday school days: ‘My people perish for lack of vision‘.  It seems pretty true in the above example.  I suppose in business we would call this ‘Strategy‘ – the shortest definition of which I can give you is ‘ends + means‘ – where ‘vision’ = ‘ends‘ – where you’ve decided to go – and then ‘means’ is how you are going to get there.   Be aware that ‘Research‘ projects (theses, mémoires, academic & commercial research reports) are like this: you set your title and Aims and Objectives – your ‘vision‘ – and then your Methodology is the means: how you are going to get there.  So doing this first block work will do more than just help you acquire business knowledge ….

Q.  So where does all this ‘change’ in the business environment factor in to businesses and organisations in general?

A Conceptual Representation of the organisation

in its environment.

Things you should notice from the above:

1. The ‘Business’ being blended doesn’t have to be commercial: one could equally imagine a public or voluntary sector organisation or things like a region, say the ‘Grand Est’ or Paris as a tourist destination.
2. The ‘External’ side is effectively the O+T of SWOT (Strengths, Weaknesses, Opportunities and Threats).
3. The ‘Internal side represents the S+W of SWOT
4. Although organisations are looking to seek an equilibrium between capabilities and the opportunities – the equilibrium should be dynamic (always on the move), not fixed, because all the internal and external components are permanently in motion.  The validity of an organisation’s ‘equilibrium position’ should be permanently under review and shift as naturally as possible in response to the change(s) in the business environment which it and its present and future customers are facing .
5. Although the STEEP(L) / PESTLE external factors are shown as separated (for reasons of simplicity), clearly they are not – they are closely related, each affecting the other: one can easily see that Technology affects Society and the Economy for example and vice-versa.
6. I did not include in the model, certain of the ‘environments’ I mentioned above (competitive, consumer, legal/regulatory) because most of you will already know the STEEPL / PESTLE model as it stands.
7. There is no computerised ‘correct‘ solution to selecting the equilibrium position. Even in situations regarding which managers have similar information in their hands about drivers of change they often make completely different decisions. [To prove this, if I am  in class you will find me doing my somewhat crazy: Bungee-Jumping (sauter à l’elastique) role play.]

So: Your Block 1 Task(s):

Trends and Drivers in Today’s Business Environment

INSTRUCTIONS

We need teams of equal size for this task.   You will need to work together in class and to work online. One team for each environment specified below: no duplication permitted!

NB. I am NOT just asking you to find ONE aspect of change in your selected business environment or to look at just one sector or company – I want to see you researching really broadly across all facets of the business environment [present to a maximum of 10 years in the future] you have chosen to look at!

Team 1. identify and consider current and forecast changes in the socio-cultural business environment and the opportunities and threats they may bring for new and existing businesses.  [You MUST record the evidence – you will need it for your presentation]

Team 2. identify and consider current and forecast changes in the technological environment and the opportunities and threats they may bring for new and existing businesses. [You MUST record the evidence – you will need it for your presentation].

Team 3. identify and consider current and forecast changes in the economic environment and the opportunities and threats they may bring for new and existing businesses. [You MUST record the evidence – you will need it for your presentation].

Team 4. identify and consider current and forecast changes in the natural/physical environment and the opportunities and threats they may bring for new and existing businesses.  [You MUST record the evidence – you will need it for your presentation].

To help you get started on this, I offer you some guidance here as to how to do this for whatever environment you and your team may have chosen from the list above…..

THEN... Once each team has researched current and forecast change in the business environment for which it is responsible, it must then consider:

1. How to best present the evidence of change in your business environment
   
2. the impacts and implications of such changes for businesses in general. [Think: what is an impact? … and what is an implication?  They are two different things.]
3. how specific existing businesses might respond to such changes and their consequent opportunities and threats.    NB. To achieve this, it might help to imagine a range of particular businesses and how they might be affected, for example (but you may prefer to choose others of course.  Some of the changes you will uncover will perhaps apply more clearly to one of the companies below than another, so change the company example as appropriate – you do not have to apply your thinking just to one company: ‘ring the changes‘ … literally!!):-

• Club Med or Hilton Hotels.
• easyJet or Ryanair or Air France
• PSA or Renault,  BMW or Audi
  
• l’Oreal or Chanel
• MacDonalds or Quick or Starbucks
  
• Carrefour or Cora or Boulanger
  
• New York or Paris or Budapest as tourist destinations

4.  Brainstorm up as many new potential ideas as you can [products / services etc] which might potentially arise from your team’s analysis of your chosen business environment [Aim for 10!!  7 or 8 I will accept ‘at a push‘, but NOT LESS]

OUTPUT REQUIRED.

At the end of this block  (date TBA) each team must deliver:

• A 10 – 15 minute presentation in class (or only if we are forced to work at distance: a live Zoom or a pre-recorded  shortvideo  presentation of no more than 10-15 minutes’ duration of your team ‘talking to a powerpoint or prezi’ [whatever you feel will have greatest impact and will work with the online technology we possess].   You will need to put your work somewhere online (a youtube channel maybe?) and send me by email to tjolley@gmail.com the link/invitation to view/listen to your work.  Also spend time to share your work with your colleagues (such presentations would have been done in class)
• All team members should play an equal part in the oral presentation (no-one should stay silent and work the PC….sorry!).
• The presentations will comprise a number of parts:-

• an ‘intro’ to the topic and the structure of the presentation (what you will do and how you will do it)
• the dynamics of the business environment you are studying (what is changing…trends:- in what direction and how fast etc). Make sure that you PROVIDE EVIDENCE of these changes: graphs / diagrams, authoritative quotations etc and ALWAYS give the date and the source!
  
• the potential impacts and implications (i.e. the opportunities and threats) of change in the business environment generally and then for particular businesses or organisations of your choice (as listed above).
  
• recommendations as to what this business/organisation might do in order to seize the opportunities and neutralise the threats you have identified.
• As many brainstormed ideas as possible [target 10!] for new products and services which might be welcome, needed and successful in the future as a result of your research. [NB. You do NOT at this stage need to develop the idea fully – just to show the evidence you have found which potentially supports it.  Development comes in the next block once we have evaluated ALL the ideas!]
  
• An ‘outro’ slide to round off the presentation effectively.

I will view this oral presentation and any associated support material.  I will award a nominal base mark for the team (but reserve the right to moderate this base mark upwards or downwards for particularly impressive or weak contribution/performance by individuals).  I will be giving detailed feedback to each group in class or in the form of an email or audio file.

LINK TO BLOCK 2.  You will develop and refine your new products / services ideas wih the help of the whole group and assess each one in terms of feasibility, viability, complexity/simplicity, risk and timing etc, then select the very ‘best’ ones and put them in a ranked list, then choose an idea that appeals to you (maybe in pairs/threes) and develop a plan to realise your concept and ‘pitch‘ it to the Dragons in the Dragons’ Den to (hopefully) generate the finance to realise your hopes and dreams.  

T