Firms operate in changing and at times hostile business environments.
The environment does not always accommodate the interests of the firm.
An organization in its environment might be likened to a ship at sea.
Sometimes the sea is rough and the ship has difficulty in making progress
on its journey, sometimes it is calm and the weather is clear so that the
ship can make steady progress. Sometimes the weather is malevolent: there
are thick fogs and icebergs which create risk for the very survival of the
ship. Organizational environments present the same kinds of opportunities
and threats for the organization as the sea does for the ship.
Organizations need to respond and adapt to changing environmental
conditions if they intend to survive. They can even instigate changes in the
environment which are in their own interests. Both demand an
understanding of those factors and forces which bring about change in the
environment. Ideally, an organization should adapt to changes as they occur,
even anticipate them in advance or systematically instigate changes to its