Companies today want their managers to think from a global perspective, unhindered by the blinders of nationalism. Although globalization is knitting the world's economies more tightly together, many important differences remain among nations. Managers of domestic companies are concerned mainly with how external forces in that one national environment affect their companies' performance. Four External Environmental Forces Cultural forces reflect a people's aesthetics, values and attitudes, manners and customs, social structure, religions, personal communication, education, and physical and material environments. Political and legal forces are matters of governmental and regulatory importance that influence the management of businesses.
Economic forces includes financial, economic, and infrastructure variables.
Competitive forces include factors such as the numbers of a company's competitors and their strategies, cost structures, and product quality. International Business Environment Managers of international companies must be concerned with external forces in all of the national business environments in which the company is involved. Five Influential Groups Consumers around the world are developing similar wants and needs for certain products. Workers can more easily relocate when employment opportunities dwindle in the home country. Companies sell goods and services around the world and acquire investment capital through international financial markets.