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External/Internal Factors

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Category: Business

Autor: anton 22 July 2011

Words: 2439 | Pages: 10


External/Internal Factors Paper

External/Internal Factors Paper

In 1962, the Dayton Corporation opened Target, a discount chain store in Minnesota. Through the years, Target has grown considerably so that in January 2000, the Dayton Hudson Corporation changed to Target Corporation. The Target Corporation Annual Report 2007 states that 118 new stores opened in 2007, 33 of them being SuperTarget stores. Nearly 1,600 stores are operating in 47 states, with plans to have 2,000 stores by 2010. Target is currently ranked as the fifth largest retailer following Wal-Mart, Home Depot, Kroger, and Costco (Stores, 2007). Target could not be successful if it did not deal with external and internal factors that can help or hinder the four functions of management.

Internal and external factors can have quite an effect on the four functions of management. For example, Target has been involved in merging or acquiring other companies. Employees have the risk of department restructuring or lay-offs. New plans and strategies will need to put in place as well as organizing the resources, or additional employees, acquired from a merger. Occasionally executives or top managers may suddenly resign, which can also cause problems if the person left under suspicious circumstances. The remaining managers will have to adjust for possible increased workloads, or managing a new department.

External factors that may have profound effect on Target could be the economy. With increased prices for gas, dairy, and other items, consumers may spend less, and often look for the best price. Competition from other retail stores also has an effect. The management of Target will need to devise new strategies to stay competitive and lure consumers into spending money at Target. An additional external factor may be demographics; college age students, working to supplement school costs, will eventually leave their jobs upon college graduation.


Globalization can be defined in economic terms as the closer integration of the countries by the huge reduction of costs in transportation, the flows of goods, services, capital, knowledge, and people across borders. Even though Target remained conservative for many years and slowly transitioned into expanding its market to foreign countries, it maintained a solid strategic position with an aggressive growth market. As of May 2005 Target crossed borders and opened its market to India. In order to effectively and efficiently deliver the best products to its customers Target created a global compliance department. The global compliance department is responsible to make sure that all policies are universally imposed. Due to the diverse products that Target offers its customers the corporation takes part in educating the vendors they outsource from with compliance policies. The global compliance team requires its vendors, including suppliers and manufacturers to provide employees with safety, healthy, non-discrimination principles, pay fair wages, refrain from child labor, and limit work hours with policies such as Standards of Vendor Engagement . By carefully selecting vendors and educating the vendors and suppliers, Target ensures that all standards are being met effectively. This promotes and builds successful vendor relationships. This strategy allows Target to deliver valued products that are outsourced through Target Sourcing Services (TSS) from other countries. The global compliance team focuses on building a dynamic relationship between vendors by asking vendors to agree to Target’s Standards of Engagement policy, which includes: register all factories used in production of merchandise, authorize unannounced audits, maintain accurate information on all their factories, allowing for tours, and employee interviews. The global compliance team is made up of 40 team leaders that are committed to reinforce and make sure that the Standards of Engagement are implemented and in compliance. Target’s culture of fashion, trend, and diversified products has greatly benefited the discount image of the corporation. Several factors contribute to Target continuing to exploit and achieve its high growth surge such as: Price- Target utilizes higher advertising/marketing costs to promote competitive prices with other discounters; Food – the core strategy of supplementing the older discount stores with the new supercenters that generate a higher volume of traffic and generates higher sales; Brands – Target continues to accomplish its own proprietary brands and strategic alliances with additional services; Online – internet retailing efforts and its partnership with other resources generates revenue; Loyalty – Target has captured most of its core consumers, with direct marketing, promotions, gift registries, and credit card programs; International – Target crossing borders into India will open a new market that will generate an enormous leverage in numerous ways. Targets team controls and maintains the changing trends in retail and global market by educating the vendors and offering training sessions that discuss global policies. Part of additional training includes meetings to discuss results and opportunities for growth or improvements. It provides additional training and information online which includes a vendor guidebook used by all factories in nine languages. This method of delegation allows the global compliance team to focus on more important facets of the corporation and build relationships with other sources.


To be competitive in a retail market, Target must be innovative. From a fashion show featuring holograms, to its new plastic cereal containers, Target continues to be original in its products and advertising. However, what is the impact upon planning, organizing, leading, and controlling? The fashion show featuring holograms was held at Grand Central Terminal in New York City. A rotating series of 10-minute shows featured clothing from exclusive Target designers (Endless Innovation, 2007).

A fashion show consisting of holograms cannot be an easy task. Much thought and planning must be given to such an event. The impact on planning is staging the show at the Grand Central Terminal; putting electronic devices into place to show the holograms. The time of day to hold the fashion show must be determined. Optimum viewing by people is achieved when the show is displayed with a high volume of people in the terminal. Then organizing all the departments necessary for the set-up, possible information displays, the taking down of equipment and storing it away.

Plastic cereal containers with flip top lids may be a convenience for busy people. Rather than having to break down empty boxes for trash, or worries of recycling, a plastic cereal container eliminates the worries. According to The Breakfast Bowl (2008), Target’s current Archer Farms house brand cereal will be packaged in distinctive plastic containers. Yet planning is essential to a new product idea: is it feasible for the company; who is the targeted consumer; will there be a standard size? Thinking of Tupperware® containers, one might wonder if Target will model the cereal containers in rectangular or oval shapes. A product line is tested on a group of consumers to determine if the project is feasible. Now the controlling part of management is impacted. Feedback is gathered. If the product testing does not go as anticipated, changes are made, and a decision whether to continue as planned or not.


Technology is an external factor that affects the internal aspects of a company. Technology has assisted businesses easily to go global in today’s competitive world. With the use of the internet, companies have been able to compete, advertise and sell their products to anyone in the world. Since Target has stores in over 40 states, the use of technology has been advantageous in making the most of email, net meetings, web cams and conference call options to hold important meetings and conversations with employees in different cities and states . This technology has also helped corporations to make the most of technology to do business with potential clients or consumers. Companies such as Target can also use updated computer systems and applications to streamline work and expedite processes; this is a positive move by corporations, in order to keep up with the strong competition in today’s business e-world. By using new technology, companies can use the greater speed and high quality of new systems to improve operational issues, which would meet an internal goal within a company to improve quality of speed, which should improve customer service. Because Target has on line services for their customers, updated technology is a valuable tool in order to satisfy customer expectations and needs.


Target as an organization uses diversity when they use the four functions of management. When Target started to plan on the atmosphere of their store, they looked to express their diversity by using the internal and external factors to express to their team members and customers that they respected and valued each and everyone’s individuality. Target knew that if they used diversity that it would make good business and would help with future success. Diversity would make all team members and customers feel more welcome when entering the store. Organizing this organization took recruiting of different backgrounds; Backgrounds of different talent, schools, cultures, and race. Target recruits its team members by picking the best candidates. They go to different schools, job fairs and even work with a wide range of historically black colleges and university, and Hispanic serving institutes. Target also seeks individuals with disabilities. “The Strength of Many. The Power of One.” Illustrates the power of individual uniqueness and the strength created when team leverage those unique capabilities and experiences towards a common goal (,2008). Target will lead by example to all competitors that diversity is what makes their organization especially successful and welcoming.

Furthermore, the organization offer team members training which includes providing information to help promote diversity, this will help control the atmosphere of the organization and bring out the advantages in the diverse team and the uniqueness of the stores.


Business ethics are the principles and standards that guide the behavior in the world of business (Bateman and Snell, 2007). The ethical issues that may arise impact the four functions of management. Planning, the first of the functions of management is the most important element in management. But when planning certain ethical guidelines affect the decisions made by a manager. At Target, ethics play a major role in planning and leaders have to take courses that include the company’s ethical guidelines. For instance, when planning an hourly team member’s schedule the manager cannot ask the team member to work off the clock. If a manager is caught encouraging such behavior it is grounds for an immediate termination even with a first offense. In the organizing function of management ethics become involved when a manager is gathering all the resources needed to get a project completed. The prevalent ethical issue that may arise at Target in organizing is recruiting the human resources needed to run the business. There are guidelines when hiring a team member not to provide false or misleading information to a candidate. For example, a manager cannot promise a certain pay to an employee with the intention of not following through. In the leading function of management, an ethical manager must manage the inclusion of all team members. It would not be ethical for a Target manager to be biased against certain team members and not others. The inclusion of all team members is instilled into the managers through constant training. In controlling, an ethical manager at Target cannot make any changes on their team without written documentation to support the change. For example, a leader who has a problem with a team member’s performance cannot terminate the team members without coaching, or training, documentation. A manager who wrongfully terminates a team member may be subject to termination depending on the situation. A manager can use delegation to help combat any concern that may arise in any ethical issues. To help prevent wrongful termination allegations, a manager can designate one team member to train all new team members and complete the documentation associated with each.


Pollock (2003) holds that delegating tasks improves productivity and is an effective training tool. By delegating job duties, Target employees find themselves with the opportunity to show leadership and build self-confidence. When managers delegate a task, they should be familiar with the job so they are able to answer any questions that might arise. In addition, requiring feedback and ensuring control measures helps to create controls that indicate progress is made. Control measures can also help find and correct any problems.

With proper planning, organizing and leading, managers can use delegation to manage technology by training employees how to use the updated technology in order to get the most out of its uses. Managers can delegate the work to employees to free up time, in order to handle other managerial issues. When poor management exists due to poor planning, it will eventually affect the company in a negative way. Even with the best technology, if the departments are not organized or lead properly, it can result in failure. The key to success lies in the four main functions of management coupled with internal and external factors being used in a positive way to create success. If a negative factor arises, management has the responsibility to change the direction of the planning and leading in order to regain focus on the goals of the company.

Target managers can work to delegate a team to promote the classes that they offer to their team members. The classes provide information to all team members about communication styles, appreciating differences, managing inclusions. Give people a compelling reason to want to work on an assignment by sharing the big picture (Messmer, M. (2007, August).

External and internal factors have an impact on the four functions of management. Target proves that it is a successful retailer while dealing with many factors that can make a difference in the store’s success or failure. While Target might follow behind the four largest retailers, the corporation continues to grow. Each year new stores and Super Targets open, each one adding to the growing number of new stores. The corporation which began as a discount store in Minnesota continues to expand its market and grow successfully.


Diversity at Target. Retrieved April 11, 2008, from

Endless Innovation. (2007). Target’s virtual advertising campaign. Retrieved April 12, 2008 from http://endlessinnovation/

Messmer, M. (2007, August). Yes, you can delegate. National Public Accountant, 6(4), 24B-24B. Retrieved April 14, 2008, from MasterFILE Premier database.

Pollock, T. (2003, May). Secrets of successful delegation. (Management methods). Electric Light & Power, 81, 5. p. 31(1). Retrieved April 13, 2008 from General OneFile via Gale:

Stores. (2007, July). Top 100 retailers. Retrieved April 13, 2008 from

Target Corporation. (2007). Annual report. Retrieved April 13, 2008 from

The Breakfast Bowl. (2008). Target innovation. Retrieved April 13, 2008 from

Bateman, Thomas S. and Snell, Scott A. (2007). Chapter 5: Ethics and Corporate Responsibilities. Management: Leading and Collaborating in a Competitive World. Retrieved April 14, 2008, from University of Phoenix, Week One, rEsource.

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