Draft Rap Etihad

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Research and Analysis Project (Draft): PESTEL Porter 5 Forces CSFs SWOT Financial Analysis- Few ratios PESTEL Analysis : Analysis of macro environment of an organization is fundamental to assess its business and financial performance. It helps in identification and understanding of major external influences which may affect the organization’s strategy and how they have coped up with those influences. Due to the dynamic nature, it is not feasible for any organization to continue without considering their environmental factors (ACCA P3 Kaplan kit page…). External environment’s information is obtained by numerous measures such as market research, observation, using social media, effective recognition and understanding of environmental changes can facilitate the organization to take measures in order to ensure that corporate objectives are being met. The analysis of business environment can be planned in PESTEL framework consisting following factors – Political, Economic, Socio-Cultural, Technological, Environmental / Ecological and Legal (ACCA P3 Kaplan kit page… ). Political factors: It is the responsibility of government to facilitate the businesses in order to ensure its smooth activities. United Arab Emirates is comprised of seven emirates established in 1971, federation comprises of rulers of the all emirates and as in many federal structures throughout the world provisional constitution assigned few powers to the new federal body and others continued to be under each Emirates governance. President and Vice-President are elected amongst the

members of the Federal Supreme Council, which comprises of the rulers of the seven emirates (1). Traditionally open discussions are held with the common people called as ‘Majlis’ commonly chaired by the emirate ruler, any senior family member or ruler may appoint ‘Wali’ in order to gain knowledge and communicate with the community. The re-election of H.H Sheikh Khalifa Bin Zayed for the another term of five year was done in November 2009 (1). It helps in ensuring stability and consistency in the government’s policies and procedures enabling organizations to be consistent and focus on long term objectives. Etihad Airways being a National airline of UAE and Government of Abu Dhabi is facilitating the airline with the physical infrastructure like business headquarters, designated airport terminals, sales offices and transportation. Social infrastructure is also provided by creating equal opportunities and ensuring law enforcement in the region. The UAE government dealt strictly with the people who organized a protest using social networking in 2012 and 94 persons are put on trial for supposedly trying to seize power in 2013 (United Arab Emirates profile). Political unrest in the constituency and European crisis has an impact on economy but the strength of financial position has helped in the smooth progress of Etihad Airways (UAE faces lower growth but outlook positive- Gulf News). Apparently there are no cash flow issues for Etihad Airways as they are funded by AbuDhabi government, which is developing rapidly because of being heavily blessed with oil reserves. Being a National Airline, Etihad Airways is in a dominating position and government may not allow any other airline to get in the way Etihad’s market in order to gain financial benefit. Economic factors: In the early ages economy of UAE was reliant upon fishing, dates and deteriorating pearl industry. Since the oil is discovered in the 1962, Abu Dhabi being first of oil exporting emirates has helped in changing civilization and wealth of the country. There is a significant concern about minimizing the dependency on

natural resources (oil and gas) and diversifying the economy through tourism and construction sectors and being a trading hub. The emirate of Dubai has been more aggressive in this approach as of Abu Dhabi (United Arab Emirates profile). The country of UAE had projected GDP growth of 2.6 per cent for the year...
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