Pestle Framework of Business - Essay Example

 Nearly all kinds of business are subject to certain environmental factors that determine their performance. The pestle analysis provides some form a basic framework that is used in assessing the possible impact of macro-environmental factors that influence the performance of any business. Pestle, which stands for political, economic, social, technological, and legal factors, involves the performance of the business in terms of the relevant advantages and disadvantages as they affect and are in-turn affected by the synergies of the environmental factors. Each of the components in the pestle analysis will often tend to portray themselves in positive and negative ways as determined by the resultant forces that operate within the business environment (Henry, 2008, p. 51). All the factors indicated in the pestle analysis have the potential of affecting the business both in positive and negative ways. As such, some of the issues that connect to the nature of reality are essentially determined by the different factors that attend to the forces of the market. Regarding the influence of the political environmental factors, matters of restrictions, policy, and other derivatives of the environment determine the nature of operations in ways that determine the trends of business. These factors have the capacity of enhancing the nature of business just as they have the potential of providing some robust framework that is used for the general performance of the business (Allen, 2008, p. 54). It is important to consider some of the issues attending to the processes of business in terms of the various issues that affect and are in turn affected by the environmental factors. An awareness of these factors is necessary for the processes of planning, strategizing, budgeting, and the general management of the business. The development of strategy is usually determined by the ability of the business to use all the positive values and qualities that are necessary for the sustenance of the business. In essence, the levels of success or failure of a business is necessarily determined by the manner in which the business connects with environmental factors as considered within the aspect of reality. The political environment usually occurs in ways that are generally available for the determination of the levels of performance of the business. It is important to consider the fact that the political factors are connected to the other macro-economic factors that determine the nature of the operating environment. Political factors in the environment of business could be conducive or hostile depending on a range of factors. Political environments that feature stringent conditions and policies will essentially stifle the aspect of competition within the process (Murray-Webster, 2010, p. 121). The realization of the range of factors that attend to the issues and values of the organization will essentially lead to the development of issues based on some of the matters that attend to matters of relevance and the determination of a range of factors that attend to the issues related to commerce and enterprise. Some of the issues that affect the operations of business are largely regulated by the fact that issues affecting business are essentially regulated by concerns in the world of business. Regarding the economic forces, certain economic factors have a direct impact on the manner in which businesses operate as understood within the framework of environmental factors. Generally, some of the issues that attend to the matter of challenge are necessarily controlled by the manner in which certain issues and processes are regulated. Economic growth and exchange rates are some of the economic factors that affect the performance of businesses within certain economic environments (Cheverton, 2005, p. 30). Economic growth encompasses a range of factors such as the availability of efficient banking services and robust and dependable infrastructure. The availability and accessibility of these services will often determine the manner in which businesses are able to appropriate their goals and missions in alignment with these changes. In this regard, some of the issues that attend to the growth of a business rely significantly on the economic forces and processes that are found within recommended practices. Businesses are likely to report different levels of growth at different times and different places due to the flux nature of some of the economic determinants of progress. The nature of economic factors such as exchange rates is that they are bound to vary greatly in relation to certain shifts in the global economic realities. Global forces such as the recent financial crisis and the geopolitical factors that affected the world led to significant dips in the performance of many firms leading to structural adjustment programs such as layoffs in order to accommodate the adverse impact on the economy. Some of the forces have the potential of affecting the economic processes in a positive manner. For instance, periods of positive economic growth are likely to correspond to the emergence of conducive macroeconomic developments such as the introduction of free trade policies and the elimination of certain tariffs that lay structural challenges to business processes (Kew & Stredwick, 2005, p. 3). In this regard, it makes some significant sense to consider the fact that most of the issues involved in the development of processes are related to the ability of firms to develop sound systems that could be used in the management of the development processes. Interest rates and inflation rates are some of the economic factors that attend to the development of processes and businesses within the general aspect of development. On this score, it is necessary to develop some structures that could be used in the development of sufficient systems and structures for the purposes of change and enhanced levels of progress. Inflation rates will tend to affect the levels of profits and the income systems of a wide range of businesses. Some businesses have had to shut down their businesses to inflationary pressures that lay obstacles on the nature of progress and performance as understood within the framework of performance. Managerial decisions, investment decisions, and entrepreneurial processes are largely controlled by the capacity of the businesses to align themselves appropriately in line with the dominant factors that regulate the nature of the business. In this regard, it is possible to consider the fact that some of the issues that affect the performance of businesses are necessarily controlled by the ability of the businesses to engage with the dominant forces on the market. On this score, it is appropriate to assess the performance of businesses in relation to the ability to engage appropriately with conditions and realities that determine their levels of progress. Costs of production are affected by the processes of business as understood within the discourse of the business. Entrepreneurship processes are usually determined by the manner in which businesses engage in the processes of change as understood together with entrepreneurship and other challenges. On this score, it might be necessary to consider the fact that the general processes of entrepreneurship and business management must take place within certain social, economic, and political spheres. These environments provide the structural anchorages that determine the manner in which businesses respond to different situations in terms of both progress and challenges (Cowan, 2005, p. 76). The collapse of American banks and the real estate sectors were made possible by certain economic realities that affected the global economies. On this score, it becomes necessary to consider the fact that some of the issues that attend to the general global business. In essence, global economic pressures necessarily regulate some of the issues that connect to the development of business processes. These pressures arise from the various factors and modalities that control the strategies and methods of business both at the local and global levels. Examples of global economic realities include the policies of liberalization and the free market economies as understood together with the discourse of globalization. In general, terms, some of the issues that attend to the processes of globalization have to be understood as consequences of some of the challenges that control the dimension and perspectives of business. Analysts have pointed out that the manifestation of global economic systems creates some kind of imbalances between weak economies and the powerful economies. For instance, the discourse of liberalization of the market economies removes the policies of protection of local markets and brings them into direct competition with the global businesses and multinationals. Multinationals are generally controlled by global systems. The nature of control works in such a manner that creates some element of harmony between the various synergies that control the economy. In essence, these economic systems are determined by a range of factors that necessarily determine the manner in which the various issues affect and are in turn affected by the systems of trade as understood together with the different issues that necessarily affect the manner of doing business. The cost of imports and the price of imported goods are significantly affected by the macro-economic factors such as the exchange rates on the global foreign exchange market (Dransfield, 2001). In essence, the economic and global forces that affect businesses and the general growth of the industry usually determine some of the issues that affect the manner of attending business. On this score, it becomes necessary to consider the fact that some of the issues affecting the development of the markets are generally regulated by certain the environmental factors. Aspects of business that affect the processes of business growth are controlled by issues that regulate business processes in ways that are generally governed by the balance between business objectives and the environmental realities. Business management and other attendant processes are determined, to a significant degree, by the various social realities. These realities work in ways that determine the nature of development, challenges, and the possible amounts of risk that emerge within the specific area of business. Some of the social issues that affect the performance of businesses include population density, trends on the market, preferences, the distribution of age, and the dominant attitudes of the people within the environment. Other social factors include cultural factors such traditions, values, mores, and expectations. These aspects usually work through some kind of a totality. These social factors provide the internal forces that regulate the trends on the market in terms of responses to new products and other considerations as conceived within the aspect of development as determined through the consequence of development and change. For instance, the trends of the market usually determine the manner in which people exercise their purchasing power and the choice of products of choice. Societies that are generally conservative may not explore innovations even if they are supported by the realities of cheaper prices and other positive considerations. The establishment of fast foods businesses in rural areas may fail to meet significant levels of progress as people in these areas are largely accustomed to consuming whole meals within domestic environments. As such, it becomes important to consider the attitudes and preferences of people in terms of their capacity to determine the range of factors and values of business. Another important consideration is the manner in which businesses operate in ways that respond to the potentialities of the environment (Bandt, 2011). Investing in environments with low income populations should be done in a manner that considers the limitation of the people in terms of disposable incomes. Some of the issues that would follow such processes include the regulation of the cost-per unit in order to lessen the burden on the potential buyers. On the other hand, it would be appropriate to adjust the prices of the commodities when setting up the businesses in places of high income earners. This implies that the process of doing business is largely controlled by a multiplicity of forces that determine the degree of success, the challenges to be faced, and the possibility of the risks involved in the business. Technological factors play a significant role in business processes. These factors work in ways that determine the levels of efficiency of a business enterprise or lack thereof. In essence, these factors are determined by a range of issues that subject the leadership to some of the challenges that affect the changes and levels of performance of these processes (Haberberg & Rieple, 2007). It is important to consider the fact that some of these issues are necessarily determined by the capacity of a business to make use of the advantages of technology for the purposes of growth. The adoption of technology usually involves some changes in the structural organization of the firm since it involves the replacement of the dominant systems with the new ones. The competitive advantage between firms in the corporate sector is largely determined by the level of adoption of technology. Case analyses have shown that firms that embrace new technologies are likely to reach higher levels of efficiency as compared to firms that are regulated by rigid and strict cultures of operation (Bensoussan & Fleisher, 2008). The processes of organizational change usually guide the adoption of technology. Essentially, environmental factors have a significant impact on the performance, organization, sustainability, and other multiple aspects that attend to the process of business growth. Both small and big businesses operate within, and are influenced by certain environmental factors as covered within the PESTLE model of analysis. The influence of these factors operates within both the global and the local environment. The influence could result in both positive and negative results depending on the manner in which the businesses adjust themselves to the processes of change. Works Cited Allen, M 2008, Analysing the Organisational Environment, Select Knowledge Limited, New York. 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