All organizations must respond in some manner to factors in their physical domain. Weather conditions, for instance, may greatly influence the activities of a firm. Airlines must follow the location and movement of hurricanes in the southeastern United States when scheduling air traffic service on routes from, for example, Miami to New Orleans. Construction companies in the upper Midwest must schedule their activities to avoid construction of roads or homes during harsh winter months. Electric utilities must monitor both the heat and cold to make adjustments in the volume of electricity that must be generated to provide heat or air conditioning to customers. And orange growers must make quick decisions about harvesting when frost warnings are issued.
Many organizations, because of the type of good or service they provide, are relatively immune to factors in the physical domain. Financial securities companies that do most of their trading on Wall Street rarely find their activities disrupted by weather conditions.
Some organizations may be affected by factors in only one or two domains. A dry-cleaning business operating in a small town may be affected only by weather conditions (colder weather usually increases the demand for dry-cleaning services), but the political, economic, social, competitive, and technological domains may have virtually no impact on the operation of business. While this may be the case, a manager of a dry-cleaning business must still be aware of changes in these domains as new methods of cleaning, laws concerning liability, new competition, or changes in customer life-styles may occur at any time.
Managers need an understanding of the various domains to classify environmental factors that either have or do not have influence on the operation of their organization. Sometimes factors from different domains merge to produce unique or unusual products.