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8/10/2019 2. PESTLE(1).ppt
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PESTLE analysisSyed Ferhat Anwar
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What is it?
Its a way of working out what is going on outthere so you can then respond to it.
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Origin!
Francis Aguilar is referred to as the originator ofthis tool.
He talked about PEST Political, Economic,Social, and Technological as the fourimportant factors for Scanning the Business
Environment. Later Legal and Environmental factors were also
added by some analysts and thus evolved theterm PESTLE Analysis.
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Use!
PESTLE Analysis is used to examine the current andfuture state of the industry/market an
organization/industry belongs/may belong to. This helps in the strategic planning and gaining the
competitive edge over the others in that market.
Importance of the factors varies depending on the nature
of the industry and company. For example environmental factors are more important to
tourism sector where as economic and political factors are moreimportant for the Banking sector.
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Task
This will also require you to undertake a SWOTof the industry
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Analyze SWOTS
A SWOT analysis is a:
Structured evaluation of internal situations(strengths and weaknesses) and externalsituations (opportunities and threats).
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SWOT Comparison Sheet
Strengths My Industry Competitor 1 Competitor 2 Competitor 3
What are your business
advantages?
What are your core
competencies?
Where are you making the
most money?
What are you doing well?
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SWOT Comparison Sheet
Weaknesses My Industry Competitor 1 Competitor 2Competitor 3
What areas are you
avoiding?
Where do you lack
resources?
What are you doing poorly?
Where are you losing
money?
What needs improvement?
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SWOT Comparison Sheet
Opportunities My Company Competitor 1 Competitor 2Competitor 3
Any beneficial trends?
Niches that competitors are
missing?
New technologies?
New needs of customers?
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SWOT Comparison Sheet
Threats My Company Competitor 1 Competitor 2 Competitor 3
Obstacles to overcome?
Aggressive competitors?
Successful competitors?
Negative economic
conditions?
Government regulation?
Changing business
climate?
Vulnerabilities?
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Prioritizing SWOTS
Once the SWOTs have been identified, they need to beprioritized, based on criteria such as:
Realistic damageto brand relationships and brand
equity if a weakness or threat is not addressed. Realistic benefitif a strength or opportunity is
leveraged.
Costof addressing or leveraging each SWOT. Timeindustry has to address or leverage each
SWOT.
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The SWOT Prioritization18
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Situation Analysis
Industry Analysis
Product/Brand Analysis
Competitive Analysis (Macro-)Environmental Analysis
Political
Economic
Social
Technological
Legal
Environmental
Industry-focus
sections
Destination
Analysis
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Task
The secondis to start working on thedestination and focus on PESTLE
Brainstorm the PESTLE with your members.
Work out how you are going to present thisinformation.
Remember it is not enough to identify the factor,you must say why it is where it is.
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Economic
Economic growth
Taxation international trade
Exchange Rate
Employment law
Health and Safety law
Inflation
Consumer confidence
Minimum wage
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Social
Income distribution
Demographics
Labour & Social mobility
Lifestyle changes Attitudes to work and leisure
Education
Fashion and Fads
Health & Welfare
Living conditions
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Technological
Changes in physical sciences
Internet
Energy use and costs Rates of technological obsolescence
New discoveries
Govt and Industry focus on tech Govt spending on research
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Legal
Employment law
Health and Safety
Taxation both corporate and consumer Other regulations
International trade barriers
Strength of the rule of law
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Task
The Thirdis to write a short piece explaininghow the industry matches with the opportunity
and threat issues you have identified.
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