If we go by simple terms, business environment is the atmosphere or the dynamics amongst which we work or without. We often hear people saying, " the business environment of that company is great" or "I am so tired of our company's business environment". It generally means all the factors that affect the ongoing of a company or business, like social, political or technological, media, government, etc. For instance, any new government economic policy might have been introduced which affected the salary system of the company or the changing trends of the youth might force the company to introduce new styles.
No business can work in isolation and everything is interlinked. The dynamic change in the business environment can open doors to many opportunities, and the task is to grab them as soon as possible.
One needs to be alert all the time to detect the upcoming threats that might affect the company. As I said, everything is interlinked. So if there is a degradation of economy on one hand, it will automatically have its effect on the company.
Resources are everywhere and you need to decide in what way you are going to extract them with efficiency. The company head need to have a solid plan to order to gain as much resources as possible.
The world is changing all the time and hence the business dynamics. So policy formation should be done accordingly which will help in improving the performance of the business.