Amrita completed her Master’s Degree in Fashion Technology from Paris. After coming back to India, she observed a shift towards formal wear in the fashion industry. To grab this opportunity, she opened a boutique in a posh area of Delhi.
She used environmental friendly method of production. To make the store run efficiently, she divided the work into small tasks so that her employees are well trained and the wastage can be reduced. Similar activities were grouped together and departments were formed.
She assigned responsibility to her sales staff in the form of clear cut targets and gave them authority to close the deal by offering a discount of 5% but the decision to give any further discount rests with her. The departments were headed by the specialists who were appointed through placement agencies and management consultants. Levels were created in the organization and helped in establishing reporting relationship.
In the earlier period of her venture, she asked her employees to put in extra hours of work. In return, she promised to give them special incentive within one year. Her business was doing well and she honours her commitment by giving them bonus.
Amrita was a good leader. She develops plans and makes decisions in consultation with her subordinates. However, she was biased with her female employees when it comes to solving conflicts among her staff.
In the above case study, which dimension of business environment is highlighted?
Answer & explanation
Correct answer: option 3
The correct answer is Option (3) → Social
Option (1) Economic — Incorrect. Economic environment is about things like interest rates, inflation and income of people. The case does not talk about these.
Option (2) Technological — Incorrect. Technological environment is about scientific improvements and new methods of production. The case does not talk about these.
Option (3) Social — Correct. Amrita saw a shift towards formal wear in the fashion industry. This is a change in social trends and tastes, so the social environment is highlighted. She also used environment friendly methods, which meets what society expects from business.
Option (4) Political — Incorrect. Political environment is about government policies and political stability. The case does not talk about these.
Note: The case study is taken from the chapter ‘Principles of Management’, but this question is based on the chapter ‘Business Environment’. However, since it is a case-study based question, all the questions on this case study are tagged to the chapter the case study is taken from. NCERT (2026-27 Edition): “(ii) Social Environment: … Social trends present various opportunities and threats to business enterprises. For example, the health-and-fitness trend has become popular among large number of urban dwellers. This has created a demand for products like organic food, gyms, bottled (mineral) water and food supplements.” |