Business Studies Collins Revision Guide. - StudyGuide.PK

EXTERNAL ENVIRONMENT (5)Political influences●●Businesses can be affected by political factors such asprivatisation of industry, that is returning industries that were runby the state to the private sector. Privatisation can also meangetting the local council to use private firms for some of its servicesor allowing private companies to run the bus routes.Those in favour of privatisation argue that a state monopoly can bejust as harmful to the public as a private monopoly, causinginefficiency and high costs that the public have to pay for indirectly.Others argue that certain products and services are so importantthat they should not be left to private firms to charge whateverprices they think that they can.Technological influences●●●New technology has led to a growth in the use of computers withinthe service industries and improved production methods. This leadsto greater efficiency for businesses and better quality products andservices for the public. New technology calls for new skills from theworkforce, which can mean more training and greater motivation.E-commerce has resulted in companies being able to reach a muchlarger market and to be ‘open’ 24 hours a day.The costs of new technology are, however, enormous and includethe financial costs of purchasing the technology, its frequentupgrading and the effect on jobs. There are also Health and Safetyconcerns associated with new technology, for example for peoplewho spend long days at a computer screen.89