Diagnosis of business health

Abstract

Every business grows, develops and dies within its life-cycle, dependent on its relations with the external and internal environment. Its “flexibility” and ability to “influence” both the internal and external environment are indications of its “health”. A healthy business is characterized by those parameters of its structure and behaviour that encourage its further development in any given environment. The “health” of the business is determined by the level of its homeostasis with the internal and external environment. This kind of health may reach various levels. It is therefore necessary to diagnose it, and to suggest changes in its business strategy and individual parameters. The health of a business should therefore represent a prerequisite of effective behaviour.