Senior managers in the lighting divisions at General Electric and Phillips carefully followed research on an energy efficient light bulb that lasts much longer than a standard bulb, and profitably used its findings. Which point is this example used to show?
Answer & explanation
Correct answer: option 1
The correct answer is Option (1) → Management of every enterprise can benefit from being aware of the dimensions of business environment.
Option (1) Management of every enterprise can benefit from being aware of the dimensions of business environment. — Correct. The dimensions of the general environment are economic, social, technological, political and legal. The management of every enterprise can benefit from being aware of these dimensions. Research produced an energy efficient bulb that lasts far longer. Managers at General Electric and Phillips saw that it could affect their growth, so they followed the research and profitably used its findings.
Option (2) Business environment differs from country to country and even from region to region. — Incorrect. This is relativity. Demand for sarees is high in India but almost nil in France. The bulb example does not compare countries or regions.
Option (3) Specific forces affect individual enterprises directly and immediately in their day-to-day working. — Incorrect. Specific forces are investors, customers, competitors and suppliers. Scientific research is a technological force, which belongs to the general environment.
Option (4) Business environment is relatively easier to understand in parts but difficult to grasp in its totality. — Incorrect. This is complexity, the difficulty of grasping the whole environment at once. The managers in the example understood the research and used it.
NCERT (2026-27 Edition): “Dimensions of Business Environment Dimensions of, or the factors constituting the business environment include economic, social, technological, political and legal conditions which are considered relevant for decision-making and improving the performance of an enterprise. In contrast to the specific environment, these factors explain the general environment which mostly influences many enterprises at the same time. However, management of every enterprise can benefit from being aware of these dimensions instead of being disinterested in them. For instance, scientific research has discovered a technology that makes it possible to produce an energy efficient light bulb that lasts at least twenty times as long as a standard bulb. Senior managers in the lighting divisions at General Electric and Phillips recognised that this discovery had the potential to significantly affect their unit growth and profitability, So they have carefully followed the progress on this research and profitably used its findings. …” |