Socio-cultural Environment

Ultimately, however, all the various PEST factors are governed by the sociocultural factors. These are the elements that build society. Social factors influence people's choices and include societal beliefs, values and attitudes. So understanding changes in this area can be crucial, as they lead to political and societal change. You need to consider demographic changes and also consumer views on your product & industry; environmental issues (especially if your product involves hazardous or potentially damaging production processes); lifestyle changes and attitudes to health, wealth age (children, the elderly, etc.), gender, work and leisure. Added complications when looking at social and cultural factors are differences in ethnic and social groups. Not all groups have the same attitudes - and this influences how they view various products and services http://www.marketing-intelligence.co.uk/help/Q&A/question14.htm

Technological Environment

Advances in technology can have a major impact on business success, with companies that fail to keep up often going out of business. Technological change also affects political and economic aspects, and plays a part in how people view their world. Just as one example, the Internet has had a major influence on the ways consumers and businesses research and purchase products. Whereas ten or even five years ago, it was rare for consumers to consider cross-border purchases this is now becoming common via services such as eBay (http://www.ebay.com/), with the result that even small businesses can now serve a global market. Politicians are still coming to grips with the tax issues involved. Meanwhile the music industry has still not found an effective solution to the threat posed by the successors to Napster. Environmental factors to consider here include the impact of climate change: water and winter fuel costs could change dramatically if the world warms by only a couple of degrees.http://www.marketing-intelligence.co.uk/help/Q&A/question14.htm

This is an area in which change takes place very rapidly and the organisations need to be constantly aware of what is going on. Technological change can influence the following:

• Changes in production techniques.
• The type of products that are made and sold.
• How services are provided.
• How we identify markets.

http://www.accaglobal.com/publications/studentaccountant/32530

Conclusion

The competitive strategy of an organization is crucial to obtain and sustain the competitive advantage in order to achieve its organizational objectives. To develop appropriate strategy, it is necessary to analyse the external environment and internal resources. The external analysing involves the assess of the industry in which the company operating and general environment such as politic, economic, social, technological (PEST) factors; then identify and select the strategy in terms of corporate, business and operation levels; finally, the management should ensure the strategy is successful implemented, and evaluate the change of the internal and external factors to manage the strategic changes.

There are many models and theories to help the manager to develop a suitable strategy of the organization. It can be concluded that using the strategy models and frameworks is important to analyse the competitive environment and develop the competitive strategy. However managers should be aware that the economic and strategic theories have some limitations can be un-suitable to develop or analyse the strategy http://www.academicdb.com/an_ap.

6. References/Bibliography

• http://www.mindtools.com/pages/article/newTMC_09.htm
• http://www.marketing-intelligence.co.uk/help/Q&A/question14.htm
• http://www.accaglobal.com/publications/studentaccountant/32530
• http://www.learnmarketing.net/environment.htm
• http://www.ebay.com
• http://www.academicdb.com/an_appropriateness_applying_pest_analysis_porter_s_8661

Date: 2015-12-24; view: 927