Business studies Project
Importance of Changes in the Business Environment and
the First Mover Advantage in Indian Business
introduction
The business environment refers to the totality of all
external and internal forces, factors, and institutions that
influence the performance, decisions, and strategies of a
business enterprise. These factors may include
government policies, economic conditions, technological
developments, competition, socio-cultural aspects, and
global trends.
For any business to survive and thrive, it must recognize,
understand, and adapt to changes in its environment.
Being dynamic, the business environment provides both
opportunities and threats. Organizations that respond
effectively to these changes gain a competitive edge,
drive innovation, and ensure long-term sustainability
need to understand the Business environment
1. Identifying Opportunities and Threats: Recognizing
environmental changes allows businesses to tap into new
consumer trends, such as the rising preference for eco-
friendly and digital products.
2. Strategic Planning and Policy Formulation: A thorough
understanding aids in making informed decisions related
to pricing, investment, marketing, and expansion.
3. Innovation and Growth: A changing environment fosters
the need for new ideas and products, like smart
applications or AI tools.
4. Optimal Use of Resources: Helps businesses use labor
and capital more efficiently.
5. Facing Global Competition: Companies must monitor
international trends to remain competitive.
6. Ensuring Sustainability: Environmentally adaptive
businesses win customer trust and stay relevant
Key environmental changes in india
- Economic: Decline in traditional investment assets and a
rise in interest in mutual funds.
- Socio-cultural: Youth population and rising literacy
influence product demand.
- Political-Legal: Policies like Digital India and simplified
tax laws affect operations
case study 1: maruti suzuKi – a First mover in indian automotive
industry
Background:
Maruti Suzuki entered the Indian car market when it
was dominated by outdated models like Hindustan
Ambassador.
The Government of India supported the need for
affordable, modern vehicles.
First Mover Advantage:
Introduced fuel-efficient, affordable cars with good
after-sales service.
Developed a vast dealership and service network.
Enjoyed strong customer loyalty and maintained top
market share.
Response to Global Competition:
Faced competition from Hyundai, Volkswagen, Tata
Motors, etc.
Invested in:
o Technology upgrades with Suzuki (Japan)
o Launching new models (Swift, Baleno, etc.)
o Maintaining strong after-sales service
o Digital financing options
Continued to lead in sales and market share due to
strategic innovation and adaptability.
case study 2: Bharti airtel – a First mover in indian
telecommunications
Background:
Airtel expanded rapidly by setting up telecom towers
and networks early on.
Became a major telecom provider due to its wide
reach and cost-effective services.
First Mover Advantage:
Captured a large customer base before major
competition emerged.
Established a strong brand identity and trust.
Response to Global Competition:
Faced competition from Reliance Jio, Vodafone-Idea,
etc.
Adapted through:
o Buying more transmission services
o Expanding broadband and fiber networks
o Improving management processes
o Strategic acquisitions (e.g., Zain Telecom in
Africa)
o Collaboration with Google for digital services
Continued strong performance in financial results and
market positioning.
conclusion
The business environment is ever-changing and
requires constant adaptation. Companies that
successfully anticipate and respond to these changes
are better positioned to grow and compete globally.
While first-mover advantage provides an initial edge,
it is not a guarantee of long-term success. Sustained
performance depends on how well a company adapts
to new technologies, customer expectations,
government policies, and competitive pressures.
Maruti Suzuki and Bharti Airtel serve as powerful
examples of how strategic vision, innovation, and
responsiveness to the environment can lead to
enduring success.
