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COHORT NAME

& Group No:

GMBA
Group 7

Group
Membe
rs:

1.
2.
3.
4.

Adetomilola Adejana
Dhawal Pandey
Dhruv Datta
Sreekar Arelli

Key points discussed:

Volatility The nature of a volatile situation is such that change is very rapid
and the ability of a person or an organization to respond is limited. The two
major factors that influence volatility are the pace of change and the
unexpected nature of the change that occurs. These situations have a telling
impact on the economics of the stakeholders involved. These changes are
usually large in nature and require an immediate response. For example, if we
consider the situation of the world economy when Islamic State of Iraq and
Syria started the occupation of the Middle Eastern states, there was an
immediate adverse effect on intra-regional trade, investment and remittances.
This had an adverse effect on the global economy since the world had to pay a
premium on the oil prices.
Uncertainty The nature of uncertainty in business environments is such
that, there is lack of predictability, and a scope for surprises. In an uncertain
situation it is very difficult to gauge what is actually happening and that lack
of clarity hinders an organization or a persons capability to face the
challenges that lie ahead. Uncertainty is dangerous when we analyse it with
an over reliance on historical data. Taking forward the above example of ISIS,
there is a very uncertain situation after the USA and its allies have started
conducting air strikes. No one knows where this situation could lead us and
how much would it cost the world economy. We can already see the impact in
terms of crude oil rising and sanctions imposed in some parts of the world.
Complexity Complex business environments are characterised by chaos
that is created by multiple issues and interactive relationships between
threats and opportunities. Increased complexity makes it impossible to arrive
at a conclusion and to decide where to begin or to end. There is some amount
of information available, but it would be very difficult to process it and arrive
at a definite conclusion. These situations tend to have a very large impact on
the economy, if organizations act on the temptations of short tem gains and
ignore the long term impacts. Here we can take the example of the
undervalued Yuan due to the huge foreign reserves available with China. In
this complex situation China is unable to decide whether to create a free forex
market or continue the same situation. Because it is interlinked with many
aspects like GDP, imports and exports the country is not able to take a right
call.
Ambiguity These environments are characterised by vagueness of reality
and the ability to misread the situation. Diverse conditions and reach into
different markets outside core competencies can cause these conditions.
Ambiguity can lead to conflict within business organizations and makes it
difficult to arrive at a definitive conclusion. These situations can cause huge
economic impact within business organizations as it happened with Kingfisher.
By misinterpreting the scope of the aviation industry and partly due to
following other players into the market, Kingfisher has suffered huge losses
and the airless had to file for bankruptcy. This in turn impacted the healthy
beverages business unit and it also had to suffer a huge market blow.

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