Pestle Analysis
Application of PESTLE analysis 1. Define the purpose of PESTLE analysis and spell out some of the main constituents of each factor.
PESTLE analysis “Political, Economic, Social, Technological, Legal and Environmental analysis” is used to evaluate the many factors in the macro environment that will affect the decisions of managers in any organisation. It is normally carried out before a SWOT analysis which is applied for assessing an internal environment of a business (Panah, 2012). Government policy, economic growth, social trends, new technologies, new laws and climate change are all examples of macro change. Political factors include tax policy, trade restrictions and tariffs. It’s what the government intends to change in the economy. Economic factors include interest rates, inflation rates and exchange rates. These factors influence a business’s day to day operations and decisions. Demand is affected by social trends such as age distribution, population growth rate and culture aspects. Technological factors can improve the competitive advantage of a business by affecting the cost, quality and innovation. Every business has to follow the law; this means that legal factors are essential for business practice. There is a rising awareness of the environmental factors, affecting how companies operate. Overall, PESTLE factors have major influences upon the success and failure of a business when setting up operation both nationally and globally (Panah, 2012). I will later apply this analysis to Alfa Romeo for all PESTLE factors and assess the risks, costs and benefits of this to the company. By using forecast trends and graph I will be able to come to a conclusion on Alfa Romeo entering the United Kingdom as a manufacturer.
2. Present forecast trends for one of your chosen element of each factor up to 2015 with a brief explanation.
Corporation tax is a tax on taxable profits of all limited companies and all organisations; it affects all organisations
PESTLE analysis “Political, Economic, Social, Technological, Legal and Environmental analysis” is used to evaluate the many factors in the macro environment that will affect the decisions of managers in any organisation. It is normally carried out before a SWOT analysis which is applied for assessing an internal environment of a business (Panah, 2012). Government policy, economic growth, social trends, new technologies, new laws and climate change are all examples of macro change. Political factors include tax policy, trade restrictions and tariffs. It’s what the government intends to change in the economy. Economic factors include interest rates, inflation rates and exchange rates. These factors influence a business’s day to day operations and decisions. Demand is affected by social trends such as age distribution, population growth rate and culture aspects. Technological factors can improve the competitive advantage of a business by affecting the cost, quality and innovation. Every business has to follow the law; this means that legal factors are essential for business practice. There is a rising awareness of the environmental factors, affecting how companies operate. Overall, PESTLE factors have major influences upon the success and failure of a business when setting up operation both nationally and globally (Panah, 2012). I will later apply this analysis to Alfa Romeo for all PESTLE factors and assess the risks, costs and benefits of this to the company. By using forecast trends and graph I will be able to come to a conclusion on Alfa Romeo entering the United Kingdom as a manufacturer.
2. Present forecast trends for one of your chosen element of each factor up to 2015 with a brief explanation.
Corporation tax is a tax on taxable profits of all limited companies and all organisations; it affects all organisations