Part 1 Introduction to PEST analysis
1.1 Environmental Analysis
Firms will carry out external analysis as part of their startegic planning.
- PESTL analysis- where legal is separated from political
- STEP analysis- PEST reordered!
- PESTLE analysis- political, economic, social, technical, legal, and ecological/environmental.
Social/Cultural environment - population demographics, social mobility, income distribution, lifestyle changes, attitudes to work and leisure, levels of education and consumerism.
Legal environment - taxation, employment law, monopolies legislation and environmental protection laws.
Economic environment - interest rates, inflation, business cycles, unemployment, disposable income and energy availability and cost.
Political environment - taxation policy, government stability and foregin trade regulations,
Technological environment - influence by government spending on research, new discoveries and development, government and industry focus of technological effort, speed of technological transfer and rates of obsolescence.
Ecological environment - ways in which the organisation can produce its goods or services with the minimum environment damage.
Part 2 Political Systems and Government Policy
2.1 Political Systems
A political system is a complete set of
- institutions
- political organisations
- interest groups
- relationship between institution
- political norms and rules that govern their functions
Firm have to take account of political system at three levels
Global- WTO, EU legislation
National- national government policy, national legislation, government department
Local- local government departments, councils
2.2 Government Policy
Government can influence firms throught legislation and government policy decisions.
- housing
- crime
- education
- defence
- healthcare
- engergy
- environmental
- farming
- town planning
- domestic
- foreign
Organisations need to ensure that they comply with legislation. Failure to do so could result in fires, closure, bad publicity and loss of customers
KEY AREAS of legislation that affect all firms include
- protecting employee rights
- protecting consumers
- protecting the environment
- health and safety
- data protection
Supra-national
- United Nations resolutions
- International Court of Justice
- Other international agreements that apply to signatories
- European Parliament
- European Courtis
National
- National Government through Acts of Parliament
- Senior Courts
- Other major courts through the principles of case law and the setting of precedents
Regional
- Regional/ federal Government
- Local councils can issue bye-laws in many countries
Data protection - pretect individuals against misuse of information about them held by organisations
- easy interrogation of large files
- speed of response
- computer system can be cross-linked to obtain personal profiles
- an individual's records can be selected easily through te search facilities
Data security - keep data safe from various hazard that could destroy or compromise it.
- phyical risk- impact on the physical environment in which system exists
- human risk- access is gained to the system by an unauthorised user, either physically or remotely
- Personal data shall be obtained and processed fairly and lawfully and inparticular shall not be processed.
- Personal data shall be obtained for one or more specified and lawful purposes, and shall not be further processed in any manner incompatible with those purposes.
- Personal data shall be adequate, relevant and not excessive in relation to the purpose or purposes of which it is processed.
- Personal data shall be accurate and kept up-tp-date.
- Personal data should not be kept for longer than is necessary
- Personal data shall be processed in accordance with the rights of data subject
- Data user is responsible for the security and protection of data against unauthorised access, alteration, destruction, disclosure or accidental loss.
3.3 Data Security
(a)Physical damage:
-fire
-flooding
-terrorist acts
-power failure
(b)Human damage:
-human interference
-vandalism
(c)Operational problems:
-Program bugs
-User operational error
(d) Data corruption
-viruses
-hackers
(e) Data theft
-fraud
-Loss of confidentiality
4.2 Health and Safety in the Workplace
law puts responsibility for health and safety on BOTH employer and employee
Employer's responsibilities
-Safe ways in and out of place of work
-Safe working environment
-Safe equipment and procedures
-Arrangement for the safe use,handling,storage and transport of articles
-Adequate investigation of accidents
Employees' responsibilities
-responsible for his or her own healthy and safety
-Consider health and safety of other people
-Co-operate with anyone carrying out duties under the act
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