You face six microenvironmental factors in your business activities, each made up of a self-contained microenvironment that stands alone but interacts with the others. Your workers, stakeholders and subcontractors or parts providers are three factors with a direct effect on your business. The other three -- the perception of your business, your competitors and the customers who keep your doors open -- have an impact that's not as direct but just as great.


Employees exert an influence on your small business’s quality, operations and profitability through their activities. Major quality and production models, including Lean, Six Sigma and total quality management, or TQM, encourage employee leadership over mere management. An example of employee commitment is the self-directed employee task group. These groups encourage their members to learn more and perform to a higher standard. The members of these groups can be motivated by external forces, such as company incentive programs, or internal forces, such as the pride and satisfaction in work done well.


Your suppliers provide products or services you need to add value to your own products or services. Those parts or services must be delivered on time and must meet your specifications for quality. If these requirements aren't met, either your production falls off or your quality suffers. In extreme cases, such as Toyota's recall of cars built from 2009 to 2011 for a faulty accelerator, suppliers can cause you problems with the public perception of your products or services. In that instance, the stringent Toyota Production System, Toyota's version of Henry Ford's TQM program, was called into question, because Toyota relied on a single supplier for accelerators used in its vehicles.


Media can mean printed, televised or online media. When Toyota had problems with its accelerators, two things happened. First, it highlighted a quality problem that was inherent in the Toyota Production System: TPS relied on a single supplier for the part. The supplier's errors affected the overall quality of the vehicle. Second, a media firestorm ensued when the quality errors caused consumer deaths. In the end, the buck stopped with Toyota. The lesson every small business should take from this is that poor quality, even if it originates with those who supply your small business with parts, can become your problem.

Partners or Investors

One way you can improve your financial position is through selling a partial interest of your company to outsiders. These sales may be shares, if you are a corporation, or equity partnership, where the investors become your business partners. Both shareholders and equity partners are stakeholders in your business. Your profitability can influence their activities, and they can influence your management practices through their vote. Although shareholders represent a short-term financial gain for a company, their demand for profits and increasing control can affect your company’s employees, practices and products or services.


Your competitors affect your business's profits by trying to take business away from you, just as you try to take away their business. Your competitors are a goad to you, just as you are to them. Their activities affect your profits, but if you provide better products for a lower cost -- and possibly faster -- than your competition, you can compete with them in ways they may not be able to match. Therein lies your advantage: You're driven to provide a product that delivers more added value for your customers than that of your competitor.


The least controllable of the microenvironments affecting your small business is the one where customers live. Long-term customers may ask questions if you end up in the media for a problem as serious as Toyota's faulty accelerator, but their previous experience with your products or services means they're more likely to turn to you after the problem is resolved. New customers may be affected by any aspect of your business. It's up to you to attract new customers through your quality and ability to fulfill their needs.