Critical Thinking Coursework Assessment
Can the PESTLE model assist a technology industry to expand into a new market effectively?
The purpose of this essay is to discuss how PESTLE assists a technology industry to expand into a new market effectively. The main argument of this essay would be PESTLE model will be able to assists a technology industry to expand into a new market effectively because of this model will analyse external environment in six fields and detect the trend of market. Therefore, company or organization is able to make suitable strategy to minimize or avoid the influence of external-environment. This essay will concern on the factors of PESTLE model and illustrate the usage of each factor in environment analysis. Consequently, industry could be able to expand into a new market effectively through the PESTLE model. The following parts of essay will be using Syngenta as an example to demonstrate how PESTLE model assist a technology industry to expand into a new market effectively. It will discuss how company affect by political factors, economic factors, social factors and technological factors. As the limitation of essay requirement, the legal and environmental factors would not describe in this paper. However, legal and environmental factors are significant in PESTLE model. PESTLE model
The simple acronym ‘PESTLE’ stands for political, economic, social, technological, legal and environmental factors. PESTLE model is a useful tool to scanning the general environment of business. (Anthony, 2008, pp.51). There is a logical and comprehensive diagram of environment was assembled by PESTLE model. (Brooks & Weatherston, 2000, pp.7) The basic function of PESTLE model would be that it provides information and data which allow the company or organisation to predict future situations and circumstances. (Yuksel, 2012). Therefore, companies are able to minimize the influence of environment by PESTLE model. In 1967, Aguilar discussed the environmental factors would affect business operation. The acronym ‘ETPS’ was given by him and it was used to describe economic, technical, political, and social factors. In the early 1970’s, the environmental factor was added in this approach by Arnold Brown. In the 1980s, the model involved in legal factor.(Richardson, 2006). A decade later of Brown’s ‘STEPE’ model, there are several economist attempt to define the environmental factors in different way, thus resulting in PEST, PESTLE, STEP and STEEPLE model. As one of the world’s largest agribusiness, Syngenta focus on delivering sustainable agriculture through innovation and technology.
Political factors of PESTLE model deal with the effects by local and national administrations and by international organisation such as the World Trade Organization. (Adrian & Alison, 2008, pp.106). It is includes items such as government regulation, taxation policy and government stability. (Anthony, 2008, pp.52). In particular, all businesses should be complying with the national law. The impact of any legislation should be considered before expand the business. It is important organization operate in a stable political system. According to the journal given by Bordo and Rousseau (2006), they claimed that there was an obvious relationship between political instability and the business returns. Instable political system would be delay or reduce investment and slow down entrepreneurial activity. So it means a successful company will avoid instable political system. Political factors will also impact the operation cost of organization. Because of there are various taxes which firms need to pay, so the operation cost of company would be increase by government policy. Syngenta focus on global agriculture industry which is important to all governments. The World food Summit defines food security as all people have access to sufficient and safe food to meet their needs all the time....
References: Adrian, H. & Alison, R. (2008). Strategic Management: Theory and Application. New York. Oxford University Press Inc. pp.105-111
Anthony, H. (2008). Understanding strategic management. Oxford. Oxford University Press Inc. pp. 51-59
Bordo, M.D. & Rousseau, P.L. (2006) ‘Legal-political factors and the historical evolution of finance-growth link.’ European Review of Economic History. Vol. 10(3), pp.421-444
Brooks, I. & Weatherston, J. (2000). The Business Environment: Challenges and Changes. Harlow. Pearson Education Limited. pp.7
Chen, C. Chang, C. & Hung, S. (2011). ‘Influences of Technological Attributes and Environmental Factors on Technology Commercialization.’ Journal of Business Ethics. Vol. 104(4), pp.525-535
Richardson, Jr. J. V. (2006). ‘The library and information economy in Turkmenistan.’ IFLA Journal. Vol. 32(2), pp.131-139
World Trade Organization, (2004). Food security. [Accessed, 12/05/2013]. http://www.who.int/trade/glossary/story028/en/
Yuksel, I. (2012). ‘Developing a Multi-Criteria Decision Making Model for PESTEL Analysis.’ International Journal of Business & Management. Vol. 7(24), pp. 52-66
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