What term is used for an external factor that may influence?

Every organization has its own culture. Almost everything that affects an organization's ability to compete and respond successfully to changes in the external environment – ultimately, the organization's success or failure – is an aspect of that culture. The internal factors determine how the organization moves forward, both as a self-contained organizational entity and in response to its external environment.

Internal Factors: Mission

Why does an organization exist? What is its purpose? Answering these fundamental questions describes an organization's mission. A successful organization has a clear sense of its ultimate purpose and knows how it intends to fulfill that purpose.

Steve Jobs' original mission statement for Apple is a great example that describes in a few words both the company's ultimate goal, "To make a contribution to the world," and how it intends to reach that goal, "by making tools for the mind that advance humankind."

Internal Factors: Leadership

Great leaders inspire and direct. Often the way they do that most persuasively is by example. After 30 years of brutal and isolating imprisonment, Nelson Mandela returned to South Africa to lead the country. It would have been understandable if upon gaining power Mandela had retaliated for the brutality of South Africa's Apartheid regime.

Instead, he advocated communication, understanding and forgiveness. Consequently, South Africa achieved independence with a minimum of violence and retained and utilized the skills of the majority of its citizens.

Internal Factors: Communication 

Successful organizations thrive on robust communication practices, where teams and team leaders communicate freely and often to improve results. This two-way communication up and down the hierarchical structure extends from top to bottom. Organizations with communication deficiencies often have rigid leadership structures that destroy trust.

Internal Factors: Organizational Structure

At one time, most organizations had highly hierarchical structures, with many layers of leadership and management defining the organization from top to bottom. More recently, there is a growing understanding that organizations with flat structures – few hierarchical layers from top to bottom – outperform organizations with hierarchical structures. W. L. Gore, a highly successful global materials science company that is focused on discovery and product innovation, has more than 10,000 employees, but only three hierarchical levels: a democratically elected CEO, a few group heads and everyone else.

Internal Factors: Learning

Learning is one of the most fundamental human activities and accounts directly or indirectly for the success of any organization. As technological advances lead to faster rates of change, successful organizations need to find a way to respond that encourages innovation and builds into every employee's experience the opportunity to learn and explore.

Today's most successful organizations, like Google, Apple, Amazon and the cluster of companies led by Elon Musk, are essentially learning organizations. Musk's willingness to explore areas where he's not already an expert has given him a tremendous advantage because what he's learning in one field often has an immediate application in another.

External Factors Affecting an Organization

External factors that affect an organization may be political, economic, social or technological. The same internal factors that lead to an organization's success inevitably characterize that organization's relationship to the external environment in these broad areas.

An organization with a clear sense of mission, for example, can explain itself better to the world and can align itself with the positive elements in each area.

Leaders who can learn and communicate what they've learned within their organizations also can learn from the organization's external environment and communicate successfully with it, resulting in an ongoing exchange of ideas to the benefit of both the organization and its environment.

Amazon, a single company that is transforming the way goods are bought and sold all over the world, has a reputation for communicating effectively with its suppliers and customers. Amazon is a customer-driven idea machine that believes the customer is always right. Determining what is right for each of its millions of customers and creating and maintaining a fast-growing organization that responds effectively to what each customer wants is Amazon's almost unprecedented triumph of 21st-century organization.

Companies are also impacted by external changes throughout society, like the impact of the #MeToo movement aimed at eliminating sexual harassment. Numerous firms have seen high level executives leave the company after credible charges had been leveled. Companies are also responding to gender equity issues by reviewing salaries of male and female employees to make sure comparable jobs receive comparable pay.

What are external factors of influence?

What are external factors called?

What term refers to external factors in your business environment that are likely to contribute to your success?

What are the 4 types of external factors?