External Analysis of National Commercial Bank Jamaica Ltd

External Analysis of National Commercial Bank Jamaica Ltd To conduct an external analysis, one must evaluate three environments; the general or macro environment, the industry and the competitive environment. In this paper, we will examine NCB’s macro environment, its industry and competitive environment. General Environment According to Carpenter and Saunders (2009), the macro environment can be defined as the larger forces that a firm faces, which includes political, economic, socio-cultural, technological, environmental and legal issues. In order to analyze NCB’s general environment, we employ the PESTEL model. The PESTEL model allows managers to carefully evaluate the political, economic, socio-cultural, technological, environmental and legal framework in which firms operate in an attempt to comprehend the potential for market growth or decline (Carpenter and Saunders 2009). In order to fully apply the PESTEL model, we will first determine the significance of each PESTEL force in relation to the study of NCB. Secondly, discover and classify how the information gleaned from research can be applied to each force and finally, analyze the information and make conclusions. Political The political force examines all the factors that impact a customer’s confidence and spending, Jamaica’s political environment is fairly stable and will be evaluated in four areas stability of the political environment, taxation policies, trading agreements, trade and social welfare regulations. The system of government that exists is constitutional parliamentary democracy, operating through three branches; the legislative, executive and judiciary. The executive branch consists of the chief of state who is represented by the Governor General and the head of state - the Prime Minister - who is determined by legislative elections held no later

than every five years. The Prime Minister is elected when he or she obtains the majority coalition in the House of Representatives. Jamaica has