Any firm is dependent upon its environment for success. To be specific, the two concepts are dependent on each other such that the existence of one without the other culminates into an unhealthy growth and development (Laudon & Laudon, 1988). In Management Information System, the firm and the environment share what is known as organizational boundaries. This is simply the demarcation between the external environment and an organizational entity.
The importance of the boundary between the two has been subjected too much discussion especially in the twentieth Century. Arguments about the relative stability of the boundaries were put forward either with an aim of increasing efficiency or gaining leverage over the external environmental factors (O'Brien, 1999). However, in today's world, organizational boundaries have become vital in that many organizations experiment with it in order to capitalize on skills, knowledge, and the resources the environment provides.
Lucas (1990) defines the concept firm environment, as a discipline in which a person or an entity is mandated with the responsibility of doing work in an efficient way, in an effort to maintain an attractive environment that can encourage other faculties.
Companies face a stiff competition and are involved in management activities to contain this competition. In designing its plans, a company ought to structure it in such a way that environmental factors are considered and incorporated (Ahituv, Neumann & Riley 1994). Understanding environment enables firm address customers unique needs. Management companies ought to create a modular plan in order for it to realize success (Banerjee & Sachdeva, 1995). Failure to put into consideration the environmental factors that shapes a firm productivity results in its ultimate downfall. On the other hand, development of other faculties will be hindered.
In conclusion, environment shapes a firm's success in significant ways. Its incorporation in managing is therefore, vital. In a nutshell, we can argue that the firm and environment are one but the same thing.