Question 1:
“PEST analysis is used by businesses around the world to devise a strategic approach to their activities”. Discuss this statement highlighting the various components of the said analysis. (25 marks)
The global environment of today is much more complex and different than that of the 10 years before where organizations were struggling to get information about a new market; and today they are drowning in information. Every organization has to react upon external environmental changes and to stay buoyant and be able to protract in the fast moving and innovating business environment, organizations need to constantly keep on upgrading the value of their products to sustain the competitive market and so companies turn to what is known
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It is important that managers understand that not only the internal and the external environment affect a business. But the macro environment that affects the organization’s operations and activities; and just as Michael Porter’s 5 forces helps us evaluate the attractiveness of a specific market and industry, PEST analysis helps us to evaluate the attractiveness of a larger global environment in which an organization operates. In short, PEST give a large helping hand in the construction of contingency plans and acts as a guide for an organization as well as is an effective tool for strategic planning. By the scrutiny of the market and customer segmentation, PEST analysis assist in setting up a strong marketing plan as it explains what differentiates a company’s proposal and targeted customer preference to that of the competitors and informs an organization whether a change or any development is required to keep on going smoothly as well as advises the organization is moving forward or …show more content…
PEST last sphere discuss on Technological factor has boost up many businesses but have also forced businesses to pull down their shutters. To walk along with technology, it demands lots of investments, an example can be the CMT (Compagnie Mauricienne de Textile) Ltd, very famous for its latest technologies, and it can easily bring forward high and premium valued products to its customers that can no doubt be found elsewhere. However, this is also true that its price of manufacturing is so high that now it has to target Grade A clients with small volume orders since its price are not competitive in the
Part of our decision was determined by the completion of a PEST analysis, or a diagnosis of the environmental situation in the region. The political, economic, social, and technological climate of the region tells us how the environment would
In order to stay current with market standards and competitive in the marketplace we too ...
In business, companies are able to control many of the factors that will improve or impair their business strategy, but some factors are beyond their control. These external factors are beyond the company’s ability to control. This external market environment consist of four primary areas: economic environment, technological environment, political and legal environment, and cultural and social environment (Perreault, Cannon, & McCarthy, 2015, p. 62). By performing a PEST Analysis each of these major areas can be explored.
In this essay I will be discussing and critically analysing each element of the PESTLE analysis within the hospitality industry, with examples to reflect each point. Also this essay will discuss how marketers should adapt to changes in the macro-environment. The PESTLE analysis is a marketing principle used to understand the relation between a company and the external environment. Murray-Webster (2010:88) states PESTLE analysis will help to capture understanding about aspects of the context by using the prompt political, economic, sociological, technological, legal and environment.
PEST Analysis of Sony Pest analysis is another marketing tool. Pest analysis examines the changes in the marketplace caused by political, economic, social and. technological factors. Political factors change from one party to another who are in control. The sand is a sand. For example, rises in private healthcare and privatisations.
Innovation has rapidly assumed a position of prominence in world competition on a global scale. To compete in this environment, organizations need a level of innovation. As competition becomes more global and time-based, organizations must develop and deliver new and superior products or services in less time. The challenge for modern organizations is to revitalize them so they can successfully and continuously develop newer products and enhance business development.
The deep analysis of the macro-environment is key to the organisations in order to understand which factors are impacting their operations. The main purpose of PESTLE analysis (Political, Economic, Social, Technological, Legal and Environmental) is to identify those factors that have an impact on the organisation but are outside its control area. Together with other frameworks (such as Porter’s ‘5 forces’), PESTLE framework is required to develop a comprehensive analytical strategic process.
A company must identify its strengths and weaknesses in order to develop growth. Downsizing products is more important than developing new products. A company must be able to identify where there weak markets are at. Times change and so do products. The products that are less profitable or simply aged are the ones that must be downsized in order to make way for a different, more innovative market. When developing growth strategies a company must use the product/market expansion grid. First the company has to figure out whether they can have better market penetration, second they must consider looking for market possibilities for current products. Third they must develop their products into innovative products that people can’t live without having. Lastly they need to be diverse with their company, therefore expanding and including different features to the company could draw more attention from different
A Competitive Audit of Nestle's Milo. I plan to produce a SWOT analysis, PEST analysis and a Competitive Audit on Milo. This is because I’m going to need to produce a good analysis of the market place, if I intend to create the best marketing strategy. This is important because there are a range of options available when creating a marketing strategy. Without these analytical processes, I will not be able to identify, which strategy is appropriate.
Market Line. India Country Profile: Pest Analysis. Data Monitor. 2012. The.
Pestle analysis is the tool to analyze the external environment of the business. It takes the different factors according to which the opportunities and threats can be analyzed and the actions plan can be made.
Every business enterprises whether it is small or large, aim to meet the needs of their potential and actual customers. There are some sorts of concepts and theories that they need to follow to do it. The essay will be looking at the marketing concepts and marketing theories which are portrayed in the PESTEL theory analysis and how they have application in guiding business marketing practice. In addition, there will be comparison between PESTEL with Porter’s 5 forces to discuss how both theories relate to each other.
Keeping up with technology is difficult, tiresome, and firms find it very costly to keep at pace with it. Technology rapidly and constantly keeps on changing. Being at par technologically requires extensive research and strategic analysis of acquiring new innovation. Enforcing new technology requires staff retraining and in some cases making employees redundant.
A PEST analysis is an analysis of the external macro-environment that affects all firms. P.E.S.T. is an acronym for the Political, Economic, Social, and Technological factors of the external macro-environment. Such external factors usually are beyond the firm's control and sometimes present themselves as threats. For this reason, some say that "pest" is an appropriate term for these factors. Let us look at the PEST analysis of the Indian aviation sector:
PESTLE analysis, which is sometimes referred as PEST analysis, is a concept in marketing principles. Moreover, this concept is used as a tool by companies to track the environment they’re operating in or are planning to launch a new project.product, or service etc.