Pestle and Five Porters Model of Chemical Industry

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Assignment # 01
M.S. (Project Management)
Management, Organizational Policies & Practices

Course Code:-
MGT-600

Tutor Name:-
Mam Razia Sultana Sahiba

Student Name:-
M. Faraz Ahmed Bajwa

Registration #:-
CIIT / SP13-RPM-051

E-mail:-
Faraz_tuf@yahoo.com

Macro Environmental Factors
1.1- PESTEL framework
1.1.1- Political effect
1.1.2- Economical effect
1.1.3- Social effect
1.1.4- Technological effect
1.1.5- Environmental effect
1.1.6- Legal effect
1.2- PESTEL segments (Combination of different PESTEL effects) 1.2.1- Demographic segment
1.2.2- Sociocultural segment
1.2.3- Technological segment and forces
1.3- Key drives of change
1.3.1- Market globalization
1.3.2- Cost globalization
1.3.3- Technical Standarization
1.4- Planning for Contingencies
1.4.1- Scenario Planning/Scenario building
1.4.2- Create Initial Scenario
1.4.2.1- Define the scope of scenario
1.4.2.2- Identify the major stakeholders
1.4.2.3- Identify environmental trends
1.4.2.4- Identify key uncertainties
1.4.3- Check each scenario for consistency and plausibility of facts 1.4.4- Create contingency plans from each scenario

Micro Environmental effects
1.5- Porter’s five forces analysis
1.5.1- Threats of new entrants
1.5.1.1- Economics of product differences
1.5.1.2- Brand quality
1.5.1.3- Switching cost or sunk cost
1.5.1.4- Capital requirement
1.5.1.5- Access to distribution
1.5.1.6- Customer loyalty to established brands
1.5.1.7- Absolute cost
1.5.1.8- Industry profitability
1.5.1.9- Cost advantage independent of scale
1.5.2- Threats of Substitute product/services
1.5.3- Bargaining power of customers/buyers
1.5.4- Bargaining power of suppliers
1.5.5- Intensity of competitive rivalry

CIIT / SP13-RPM-051

Introduction to Industry:
In this section we will take a chemical industry. Product of a chemical industry can be a soda ash, hydrochloric acid, or hydrogen peroxide etc. Chemical industry have many applications in our daily life and in other industry especially in textile industry, such as hydrogen peroxide is used as bleaching agent and soda ash used as washing powder. PESTEL effects have influence on the performance, development and fortification on a industry. These effects can be explained as follows,

Political Effect:
Political effects have great influence on a chemical industry, such as political party may change their import/export rules and regulations, these effects can change the rules for a chemical industry.

Economical Effect:
As raw material and basic necessities of a chemical industry are very expensive, so a rapidly going organization have less economical bad effects while a company with less profit have more economical bad effects.

Social Effect:
Social effects are concerned with the internal effects of a chemical organization such as labor law, annual increments, and other employee’s policies. Unfortunately in Pakistan our chemical industry pays very low packages to their employees, that have a adverse effect on the development of an chemical industry.

Technological effect:
Technological effect consider most important in all PESTEL framework. Technological team consists of expertise and trained manpower such as Engineers, Supervisors, Technicians, Fitters, and Operators etc. If technological team of a chemical industry is technically strong and have complete command on operation and maintenance then industry might be progress in very fast way.

Environmental effect:
Some chemical industry has bad environmental effect, such as surrounding around hydrogen peroxide has a bad effect on crops and plants, while hydrochloric acid have pungent smell. An environmental team at Govt. level ensures the environmental effects on a chemical...
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