Q.Distinguish between internal environment and external environment.

The internal and external environments differ mainly in where the influencing factors originate and how much control the firm has over them. …

The internal environment refers to the conditions, resources, and forces that exist within the boundary of the organisation itself — its financial and human resources, its organisational structure, the culture and values shared by its people, and the philosophy and policies of its management. Because these elements originate inside the firm, management has a significant degree of control over them and can reshape them through deliberate decisions. The external environment, by contrast, refers to conditions and forces that exist outside the firm's boundary — customers, competitors, suppliers, government regulation, economic conditions, social attitudes, technology, demographic patterns, and natural conditions. The firm cannot directly control these external forces; it can only observe, anticipate, and adapt its own strategies to them. This is the essential distinction: internal factors ar …

A frequent mistake is placing 'competitors' or 'customers' under the internal environment because they feel closely connected to daily business activity — but both are outside the firm's own boundary and belong t …