Organizational Behavior and Customer Demand Customer Demands Term Paper

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Organizational Behavior and Customer Demand

Customer demands might seem to be something quite simple to respond to -- when customer demands increases, an organization increases its overall level production, and when customer demand decreases, the organization must decrease its supply and price. However, in addition to such responses to simple microeconomic theory, other organizational factors come into play. Customer demand, for example, is affected by external factors such as overall economic health, employment, potential for future employment, and consumer confidence. Also, the perception of the goods being sold in the industry as a necessity or a luxury, and the availability of potential substitutes can cause demand to fluxuate in a fashion that the industry must respond to effectively and efficiently.

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Managers may need to cut costs or reduce worker's benefits and raises to respond to the external factor of a decrease in overall consumer demand. But they also must still ensure that employees that do remain retain a reasonable level of enthusiasm and responsiveness to their working environment, to ensure that when business improves, the organization is poised to improve as well. (MacGregor, cited in Weirtheim, 2000)

Furthermore, internal organizational factors also have an impact upon managers that workers and managers often have no control over. This is not necessarily a bad thing, as the development of technology can cause a good to….....

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