A review of techniques to analyze the environment and an assessment of their suitability The analysis of the environment in which the business operates is very important. It is very crucial for the business to ensure survival, differentiation and competitive advantage. There are three levels in which the environment of the business can be broken which are as follows: The Macro environment
The model that is most commonly used to analyze the macro environment of the business is called PESTLE analysis. Using this analysis the political, economic, social, technological, legal and environmental factors affecting the business are analyzed. The political factors consist of the law and order condition and the political stability in the country where the business operates. The economic influences include factors such as the monetary and fiscal policy of the country. Similarly, it also include the per capita income of the people and the overall economic condition of the country where the business operates. The social factors also vary from one country to other and might impact the business it include the social customs and habits of the people which might impact their buying decision. The use of the technology might also impact the operations of the business. Legal factors include the general laws of the country which might also impact the business. The environmental influences can also impact the operations of the business. The micro environment
The micro environment of the company can be easily understood with the help of the Porter’s five forces analysis. This model can be used in order to properly understand the competitive position of the company with respect to its market and industry. This model consist of bargaining power of buyers, bargaining power of suppliers, threat of new entrants, threat of substitute products and rivalry among the existing competitors. The internal environment
The best tool which can be used to in order to understand the internal environment of the company is SWOT analysis. This tool defines the strengths, weaknesses, threats and opportunities of the business. The strengths and weaknesses are internal to the business whereas the opportunities and threats are considered to be external to the business. All the above discussed techniques which can be used to analysis of the business are very useful and suitable. The PESLE analysis presents the complete picture of the macro environment of the business. Similarly, the Porter’s five forces model is extensively used for the analysis of the micro environment of the business. Furthermore, the SWOT analysis is the best tool with the help of which the internal environment of the business can be ascertained in an efficient way.
An analysis of micro and macro environment of business using techniques discussed above. The analysis of the micro and macro environment of Unilever can be done in an effective way with the help of PESTLE analysis and the Porter’s five forces analysis. Macro Environment
Political and Legal Analysis
Unilever has to face the regional, local and global laws, rules and regulations. Some diverse areas such as product claims, product safety, copyright, trademarks, patens, the environment, corporate governance, employment and taxes are covered by these rules and regulations. Unilever may face legal action in the country where it operates if does not comply the laws and regulations of that country. Furthermore, the reputation of Unilever will also be affected if it breaches any laws. The change in taxes or the government will also affect the business of Unilever. Economic Analysis:
If the economy of a country, a region or the globe at large is affected it will also affect Unilever. Most of the brands of Unilever are reliant upon the demand of the customers and decline in the income of the customers will also affect the sales of Unilever. Due to the global financial crisis that took place in 2008, the operations of...
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