What are the uncontrollable external factors that influence an organization's performance and decision-making known as?

CIPS Managing Ethical Procurement and Supply Test is designed to enhance your understanding of ethical practices in procurement. Study with comprehensive questions and explanations. Prepare effectively for your exam!

The correct answer is macro-environmental factors because this term encompasses the broader external forces that can impact an organization's operations and strategic decisions. These factors typically include economic, political, social, technological, legal, and environmental influences that exist outside the organization and cannot be controlled by it. For instance, changes in legislation or shifts in consumer behavior are macro-environmental factors that can significantly affect how a business operates and competes in the market.

In contrast, organizational factors refer to internal structures, cultures, and policies that influence performance but are within the organization's control. Micro-environmental factors might include customers, suppliers, and competitors, which are important but still represent a more immediate and specific context than broader macro-environmental factors. Internal factors focus solely on aspects internal to an organization, further distinguishing them from the externalities classified as macro-environmental. Therefore, macro-environmental factors are the most comprehensive term for the uncontrollable external influences on an organization's performance and decision-making.

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