What is an External Environment ?
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The document discusses the external environment and PESTLE analysis framework. The external environment includes factors outside an organization's control that provide opportunities or pose threats. A PESTLE analysis examines the political, economic, social, technological, legal, and environmental factors in the macro environment. It is used to understand the external factors that may impact an organization's strategy and objectives. The document then provides examples of various factors to consider under each element of the PESTLE framework.
What is an External Environment ?
- 2. Types of Environment ?
- 3. Types of Environment ? • Internal Environment • External Environment
- 4. External Enviornment • Factors outside-the organisation which provide opportunities or pose threats to the organisation. • Factors that can impact the ability of a business or investment to achieve its strategic goals and objectives. • Uncontrollable Factors
- 5. Macro Enviornment (PESTLE) • Refers to the external factors which affects company and its business and there is no control of compnay on these factors. • Types of Factors ⚬ Economic ⚬ Non Economic ￭ Political ￭ Demographic ￭ Socio Cultural ￭ Technological ￭ Natural
- 6. Macro Environment • Economic - • The Economic Environment constitutes of economic conditions, economic policies and the economic system that is important to external factors of business • Economic environment refers to the nature and direction of the economy within which business organisation are to operate.
- 7. Macro Environment • Non Economic • Political and Legal Forces • Refers to the Political government and legal environment. It has close relationship with the system and economic policy. • This refers to set of laws, regulations, which influence the businness organisations and thier operations.
- 8. Macro Environment • Non Economic • Demographics Forces • Demography Refers to study of the population. Demographic factors are as below. ⚬ Size of Population ⚬ Growth Rate ⚬ Family Size ⚬ Educational Level ⚬ Age Composition ⚬ Gender Composition
- 9. Macro Environment • Non Economic • Social Cultural Forces • Socio Cultural Environment is an important factor that should be analysed while formulating compnay business strategies. • These includes peoples attitude to work and wealth, ethical issues, role of family, marriage, religion and education and the social responsibilities of business.
- 10. Macro Environment • Non Economic • Technological Forces • Technological Forces or factors could be said to be the most pervasive in the environment. Technology refers to the application of knowledge base which science provides. It is a well established fact that information and communication technology has revolutionized business operations
- 11. Macro Environment • Non Economic • Natural Forces • The natural environment includes geographical and ecological factors that influence the business operations. These factors include the availability of natural resources, weather and climatic condition, location aspect etc.
- 12. Pestele Analysis • This is framework used to analyse the external environment analysis. the process entails learning about various external factors which affect the organisation. ⚬ Political ⚬ Economic ⚬ Social ⚬ Technological ⚬ Legal ⚬ Enviornmental