Pest Analysis

Topics: Airline, Airport, Avianca Pages: 1 (320 words) Published: January 6, 2009
A pest analysis is simply a way of analyzing characteristics of the acronym PEST: political, economical, social and technological aspects of a certain environment. It is important to conduct an airline pest analysis in today's world because there are so many different considerations to take note of. In today's business world, political factors can influence the way in which a business works. If an airline is incorporated within a country with a harsh political climate then politics plays a large role in determining the scope of business the company can handle. For instance, airlines that fly to the Middle East have to consider potential dangers of doing business in a potentially hostile climate. In terms of economic data, a pest analysis of an airline is beneficial to determine whether or not economic goals are being met. Other things that can be determined from this analysis include budget limits, rate of inflation, salary structure, equipment maintenance, and how business will be conducted in the future. The airline business requires high overhead costs therefore, economic analysis is highly important. When considering social factors in the airline industry, it is important to remember that safety is the number one concern. The events of September 11, 2001, have changed the way the airline industry works. For instance, security has become the focal point behind how airlines operate. Concerns over previous security personnel have made many airlines reconsider their hiring practices. The last aspect of a PEST analysis is the technological realm of conducting business. In industries such as the airline industry, technology plays a chief role. Due to the high price of gasoline, many airline industry executives are hoping that new and cheaper forms of fuel are created for use. In addition, there are more automated ticketing kiosks than ever before. As time progresses, more of these machines will be added to airports enabling business to be streamlined and...
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