SlideShare a Scribd company logo
1 of 19
Download to read offline
MODULE 2:
MACROENVIRONMENT:
PEST ANALYSIS
STRATEGIC
MANAGEMENT
DR. EMMANUEL DOTONG
Associate Professor of Business
ejdotong@alum.up.edu.ph
STRATEGIC TOOLS AND MODELS
Module
Coverage
01
02
Business Macroenvironment
PEST ANALYSIS
MODULE 2:
PESTLE ANALYSIS
03 PEST ANALYSIS APPLICATION
01
BUSINESS MACROENVIRONMENT
Definition and Factors
BUSINESS
MACROENVIRONMENT
The macroenvironment refers to the
broader external factors and conditions
beyond a company's immediate control that
influence its operations, strategies, and
overall business environment. These factors
include economic, political, social,
technological, legal, and environmental
elements that collectively shape the context
in which an organization operates.
POLITICAL
ENVIRONMENT
ECONOMIC
SOCIAL
TECHNOLOGICAL
ENVIRONMENT
ENVIRONMENT
ENVIRONMENT
02
PEST ANALYSIS
Purpose and Factors
PEST ANALYSIS
PEST
ENVIRONMENT
ECONOMICAL FACTORS
Involve the financial conditions and
trends that affect businesses, including
aspects like growth rates, inflation, and
consumer spending patterns.
TECHNOLOGICAL FACTORS
Encompass the advancements and innovations in
technology that impact industries, influencing
business strategies and operations.
POLITICAL AND LEGAL FACTORS
Encompass the governmental and regulatory
influences that impact business operations
and decisions within a specific region or
country.
SOCIAL FACTORS
Encompass the cultural, demographic, and
societal influences that affect consumer behavior
and shape market trends.
MACROENVIRONMENT FACTORS
MACROENVIRONMENT
§ PEST analysis serves as a valuable strategic
framework, systematically assessing the impact of
external macro-environmental elements on
businesses or industries.
§ By scrutinizing Political, Economic, Social, and
Technological factors, it empowers organizations
with a comprehensive understanding of the larger
context in which they operate. This informed
perspective aids decision-making and facilitates
strategic planning by highlighting potential
challenges, opportunities, and changes influenced
by these factors.
§ PEST analysis equips businesses to proactively
adapt, capitalize on emerging trends, and mitigate
risks associated with their operating environment.
PEST ANALYSIS
POLITICAL AND LEGAL FACTORS
PEST ANALYSIS
§ Government Grants And Incentives
§ Changes In Government Leadership
§ Corruption Levels And Transparency
§ Government – Business Partnerships
§ Intellectual Property Enforcement
§ National Security And Defense Policies
§ Local And National Election
§ War And Terrorism
§ Campaign Finance Regulations
§ Trade Sanctions And Embargoes
§ Immigration And Work Permit Regulations
§ Cybersecurity Laws And Regulations
§ Land Use And Zoning Regulations
§ E-commerce Business Regulations
§ Discrimination Regulations
§ Employment Laws & Regulations
§ Contract & Commercial Law
§ Intellectual Property Rights
§ Health & Safety Regulations
§ Data Protection & Privacy Laws
§ Competition Laws & Antitrust
§ Consumer Protection Laws
§ Environmental Regulations
§ Import & Export Regulations
§ Licensing & Accreditation Permits
§ Diversity Regulations
§ Tax Laws & Regulations
§ Product Liability & Quality Standards
§ International Trade Laws & Treaties
§ Employee Rights And Labor Laws
ECONOMIC FACTORS
§ Foreign direct investment inflows and outflows
§ Government budget deficit or surplus
§ Public debt-to-GDP ratio
§ Private sector credit growth
§ Stock market indices and trends
§ Bond market yields and trends
§ Interest rates (short-term and long-term)
§ Real estate market trends
§ Exchange rate trends and volatility
§ Sovereign credit rating
§ Investment rate
§ Manufacturing output and capacity utilization
§ Retail sales growth
§ Industrial production growth
§ Balance of trade and balance of payments
§ Capital expenditure trends
§ GDP growth rate
§ Inflation rate
§ Consumer Price Index (CPI)
§ Producer Price Index (PPI)
§ Unemployment rate
§ Labor force participation rate
§ Employment-to-population ratio
§ Wage growth rate
§ Productivity growth rate
§ Central bank policy rates
§ Money supply
§ Commodity prices
§ Savings rate
§ Consumer confidence index
§ Business sentiment index
§ Export and import growth rates
PEST ANALYSIS
SOCIAL FACTORS
§ Demographic lifestyles
§ Cultural diversity and multiculturalism
§ Urbanization and rural migration
§ Consumer attitudes towards sustainability
§ Health and wellness trends
§ Educational attainment and literacy rates
§ Lifestyle preferences and leisure activities
§ Traditions and customs
§ Attitudes towards work-life balance.
§ Aging population and retirement trends.
§ Changing gender roles and equality.
§ Social values and ethical considerations
§ Adoption of new social norms
§ Buying habits
§ Impact of social media on consumer behavior
§ Cultural values and norms
§ Social media and digital communication trends
§ Cultural perceptions of products and brands
§ Attitudes towards entrepreneurship
§ Attitude Towards Eco-friendly Products
§ Age distribution and generational preferences
§ Cultural integration in global markets
§ Cultural influences on consumer behavior
§ Cultural taboos and sensitivities
§ Cross-cultural communication challenges
§ Age distribution by cohorts
§ Birth rates and fertility rates
§ Death rates and life expectancy
§ Population density and urbanization rates
§ Ethnic and racial composition
§ Educational levels and enrollment rates
PEST ANALYSIS
§ Rate of Technological Change
§ Disruptive Technologies
§ Research and Development (R&D) Funding
§ Innovation Ecosystem
§ Intellectual Property Protection
§ Digital Transformation
§ Technology Transfer
§ Open-Source Collaboration
§ Automation Potential
§ Technological Infrastructure
§ Technological Convergence
§ Skills Gap & Industry 4.0
§ Biotechnology Advancements
§ Nanotechnology Potential
§ Quantum Computing and Genetic Engineering
§ Renewable Energy Innovations
§ Space Technology
§ Augmented and Virtual Reality
§ Cybersecurity Advancements
§ Internet of Things (IoT) Growth
§ 5G and Connectivity Expansion
§ Artificial Intelligence (AI) Progress
§ Machine Learning Applications
§ Big Data Analytics
§ Cloud & Cognitive Computing Adoption
§ Blockchain Technology
§ Autonomous Vehicles Development
§ Sustainable Technology Solutions
§ Health Tech Innovations
§ E-commerce Innovations
§ Robotics Advancements
§ Smart Cities Initiatives
§ Wearable Technology Trends
§ Clean Energy Technologies
§ Virtual Healthcare Services
§ Educational Technology (EdTech)
TECHNOLOGICAL FACTORS
PEST ANALYSIS
03
PEST ANALYSIS APPLICATION
Instructions and Analysis
PEST ANALYSIS
APPLICATION
Examines Political, Economic, Social, and Technological factors to identify opportunities and threats,
providing valuable insights for informed decision-making and planning.
01
02
03
IDENTIFY EXTERNAL
FACTORS
ANALYZE THE BUSINESS
IMPLICATION
DEFINE SCOPE
AND PURPOSE
Determine whether the analysis is focused on a specific project, business, industry,
or market. This clarifies the context for which the analysis is being conducted.
Recognize the primary external influences that impact the industry your company belongs: Political, Economic, Social, and
Technological (PEST) factors. These factors collectively shape the broader context within which the subject operates.
Evaluate the impact of each identified factor. Understand how political, economic, social, and technological forces can
influence operations, opportunities, and challenges. Translate these insights into actionable strategies to guide decision-
making and planning.
PEST ANALYSIS
E1 Minimum Wage Increase
E2 High Inflation Rate
E3 Increase in Supply Chain Cost
ECONOMIC FACTORS
T1 Social Media Trends
T2 Online Reservation Systems
T3 New Smart Kitchen Technologies
TECHNOLOGICAL FACTORS
P1 Revised Public Establishments Smoking Policy
P2 Revised Tax Policies for Alcoholic Beverages
P3 Active Public Health Campaigns
POLITICAL FACTORS
S1 Health and Wellness Trends
S2 Consumer’s Digital Dependence
S3 Active Cultural Events and Holidays
SOCIAL FACTORS
MACROENVIRONMENT FACTORS
A
NA
L
Y
S
I
S
P
E
S
T
P1 Revised Public Establishments Smoking Policy
All indoor public establishments, including restaurants, bars, and entertainment venues, are now
required to be smoke-free environments. This change aligns with growing health awareness trends and
aims to provide clean and safe spaces for patrons and employees (De la Cruz, 2023)
E1 Minimum Wage Increase
The Philippines has announced a 20-peso increase in the minimum wage in Metro Manila to address rising
living costs and enhance worker compensation, aiming to improve their quality of life. While this move
positively impacts workers, businesses may need to navigate higher labor costs and potential shifts in
consumer spending (Dotong, 2023).
S1 Health and Wellness Trends
The landscape of health and wellness is in constant flux, influenced by shifting consumer choices,
technological progress, and a heightened focus on overall well-being. This is evident in trends like the rise
of plant-centric diets, tailored nutrition plans, the surge in non-alcoholic consumption, and the demand
for clear nutritional information (Jimenez, 2023).
T1 New Smart Kitchen Technologies
Smart kitchen technologies are transforming the operations of restaurants and bars, improving efficiency,
customer experiences, and safety. These include Kitchen Management Systems, Smart Kitchen
Appliances, Temperature and Monitoring Sensors, Kitchen Display Systems (KDS), Digital Recipe
Management, Voice-Activated Assistants, Smart Dishwashers, Allergen and Dietary Preference
Management, and Waste Management Solutions, and others (Ocampo, 2023)
P1 BUSINESS IMPLICATIONS
If a significant portion of regular patrons are smokers, the
policy change might lead to a temporary drop in revenue
during the adjustment period.
Initial Revenue Dip
Inadequate implementation might result in legal
consequences, fines, or damage to the reputation of the
company.
Regulatory Compliance
Some patrons might perceive the policy as restrictive,
affecting the company’s traditional image and appeal.
Change in Public Perception
Implementing the policy requires training staff, adjusting
outdoor areas, and enforcing new rules, which could strain
resources.
Resource Allocation
Enforcing a smoke-free policy aligns with health trends,
portraying the establishment as a responsible and
health-conscious establishment.
Health-Conscious Image
A smoke-free environment attracts non-smokers,
families, and health-conscious individuals, potentially
increasing foot traffic and revenue.
Broader Customer Base
Providing a smoke-free workplace enhances the
health and job satisfaction of employees, contributing
to a positive work environment.
Improved Employee Well-being
Smoke-free air improves the overall dining and socializing
experience, making the establishment more appealing to a
wider audience.
Enhanced Customer Experience
Business
Implications
Revised Public Establishments
Smoking Policy
Adaptation and strategic planning can help bars
successfully navigate these changes and create healthier
and more welcoming environments for their patrons.
Political Factor Evaluation
E1 BUSINESS IMPLICATIONS
Higher wages lead to increased labor expenses, potentially
impacting the establishment’s profitability.
Increased Labor Costs
Rising labor costs might necessitate price hikes on menu
items, potentially deterring price-sensitive customers.
Repricing Pressure
If competitors don't match the wage increase, the
establishment might face challenges in retaining and
attracting staff.
Competitive Challenges
Smaller establishments with limited financial flexibility might
struggle to accommodate sudden wage increases.
Budget Constraints
Higher wages can boost employee morale, leading to
increased job satisfaction, engagement, and lower
turnover rates.
Improved Employee Morale
Employees earning more can lead to increased
disposable income, potentially boosting patronage to
the establishment.
Consumer Spending Boost
Motivated and satisfied employees may provide better
customer service, resulting in improved dining
experiences.
Enhanced Quality of Work
Demonstrating commitment to fair wages can enhance the
establishment’s reputation, attracting socially conscious
customers.
Positive Public Image
Business
Implications
Minimum Wage Increase
Careful planning, considering the establishment’s financial
health and customer base, can help mitigate potential
negatives and leverage the positives for overall business
success.
Economic Factor Evaluation
T1 BUSINESS IMPLICATIONS
Acquiring and implementing smart kitchen technologies can
be costly, potentially straining budgets
High Initial Investment
Staff requires training to operate and troubleshoot the
technology effectively, leading to additional time and effort.
Training Requirements
Malfunctions or technical glitches might disrupt
operations and lead to customer dissatisfaction.
Technical Issues
Automation could lead to concerns about job displacement
among staff responsible for manual tasks.
Job Displacement Concerns
Smart kitchen technologies streamline operations,
reducing preparation time and improving overall
efficiency.
Enhanced Efficiency
Automation and streamlined processes might lead to
lower labor requirements, positively impacting costs.
Reduced Labor Costs
Faster service, accurate orders, and consistent quality
contribute to an improved dining experience.
Enhanced Customer Experience
Smart technologies encourage experimentation with new
cooking techniques and menu items.
Innovation Opportunities
Business
Implications
New Smart Kitchen Technologies
Navigating the adoption of smart kitchen technologies requires careful
assessment of benefits and drawbacks. Proper planning, staff training, and
contingency measures can help maximize the positive impacts while mitigating
potential challenges.
Technological Factor
Evaluation
END Thank you for Listening!
ASSOC. PROF. EMMANUEL DOTONG
Management Consultant
ejdotong@alum.up.edu.ph

More Related Content

Similar to PEST Analysis - Emmanuel Dotong.pdf

ENVIRONMENTAL FACTORS THAT INFLUENCES THE OPERATIONS OF THE BUSINESS
ENVIRONMENTAL FACTORS THAT INFLUENCES THE OPERATIONS OF THE BUSINESSENVIRONMENTAL FACTORS THAT INFLUENCES THE OPERATIONS OF THE BUSINESS
ENVIRONMENTAL FACTORS THAT INFLUENCES THE OPERATIONS OF THE BUSINESSprince koduah
 
environmental influences in business
environmental influences in businessenvironmental influences in business
environmental influences in businesskscnair
 
Pestleanalysis 180927005625
Pestleanalysis 180927005625Pestleanalysis 180927005625
Pestleanalysis 180927005625BertsMaguigad
 
Pestleanalysis 180927005625
Pestleanalysis 180927005625Pestleanalysis 180927005625
Pestleanalysis 180927005625JhobertQuibot
 
Pestle analysis
Pestle analysisPestle analysis
Pestle analysischrstnbgll
 
· My Bookshelf· TOCAnnotation menu· Downloads· Prin.docx
· My Bookshelf· TOCAnnotation menu· Downloads· Prin.docx· My Bookshelf· TOCAnnotation menu· Downloads· Prin.docx
· My Bookshelf· TOCAnnotation menu· Downloads· Prin.docxLynellBull52
 
Marketing managers are tasked with shaping the elements of the mar.docx
Marketing managers are tasked with shaping the elements of the mar.docxMarketing managers are tasked with shaping the elements of the mar.docx
Marketing managers are tasked with shaping the elements of the mar.docxinfantsuk
 
Stable environment/Dynamic environment
Stable environment/Dynamic environmentStable environment/Dynamic environment
Stable environment/Dynamic environmentVJIMPGDM
 
service marketing environment
service marketing environmentservice marketing environment
service marketing environmentcpjcollege
 
Marketing environment - Unitedworld School of Business
Marketing environment - Unitedworld School of BusinessMarketing environment - Unitedworld School of Business
Marketing environment - Unitedworld School of BusinessArnab Roy Chowdhury
 
Class_XII_Account_Business Environment ppt 2020.pdf
Class_XII_Account_Business Environment ppt 2020.pdfClass_XII_Account_Business Environment ppt 2020.pdf
Class_XII_Account_Business Environment ppt 2020.pdfSwatiRathor5
 
Class_XII_Account_Business Environment ppt 2020.pdf
Class_XII_Account_Business Environment ppt 2020.pdfClass_XII_Account_Business Environment ppt 2020.pdf
Class_XII_Account_Business Environment ppt 2020.pdfAMANPathak744625
 
Class_XII_Account_Business Environment ppt 2020.pdf
Class_XII_Account_Business Environment ppt 2020.pdfClass_XII_Account_Business Environment ppt 2020.pdf
Class_XII_Account_Business Environment ppt 2020.pdfSumitBaghel25
 

Similar to PEST Analysis - Emmanuel Dotong.pdf (20)

ENVIRONMENTAL FACTORS THAT INFLUENCES THE OPERATIONS OF THE BUSINESS
ENVIRONMENTAL FACTORS THAT INFLUENCES THE OPERATIONS OF THE BUSINESSENVIRONMENTAL FACTORS THAT INFLUENCES THE OPERATIONS OF THE BUSINESS
ENVIRONMENTAL FACTORS THAT INFLUENCES THE OPERATIONS OF THE BUSINESS
 
environmental influences in business
environmental influences in businessenvironmental influences in business
environmental influences in business
 
Pestleanalysis 180927005625
Pestleanalysis 180927005625Pestleanalysis 180927005625
Pestleanalysis 180927005625
 
Pestleanalysis 180927005625
Pestleanalysis 180927005625Pestleanalysis 180927005625
Pestleanalysis 180927005625
 
Pestleanalysis 180927005625
Pestleanalysis 180927005625Pestleanalysis 180927005625
Pestleanalysis 180927005625
 
Pestle analysis
Pestle analysisPestle analysis
Pestle analysis
 
Pestle draft03
Pestle draft03Pestle draft03
Pestle draft03
 
Pestle analysis
Pestle analysisPestle analysis
Pestle analysis
 
· My Bookshelf· TOCAnnotation menu· Downloads· Prin.docx
· My Bookshelf· TOCAnnotation menu· Downloads· Prin.docx· My Bookshelf· TOCAnnotation menu· Downloads· Prin.docx
· My Bookshelf· TOCAnnotation menu· Downloads· Prin.docx
 
Marketing managers are tasked with shaping the elements of the mar.docx
Marketing managers are tasked with shaping the elements of the mar.docxMarketing managers are tasked with shaping the elements of the mar.docx
Marketing managers are tasked with shaping the elements of the mar.docx
 
Chapter03 (1)
Chapter03 (1)Chapter03 (1)
Chapter03 (1)
 
Stable environment/Dynamic environment
Stable environment/Dynamic environmentStable environment/Dynamic environment
Stable environment/Dynamic environment
 
Bba vi (ib) (gu)
Bba   vi (ib) (gu)Bba   vi (ib) (gu)
Bba vi (ib) (gu)
 
The inemmo STEEP Model_inemmo.pdf
The inemmo STEEP Model_inemmo.pdfThe inemmo STEEP Model_inemmo.pdf
The inemmo STEEP Model_inemmo.pdf
 
service marketing environment
service marketing environmentservice marketing environment
service marketing environment
 
Marketing environment
Marketing environment   Marketing environment
Marketing environment
 
Marketing environment - Unitedworld School of Business
Marketing environment - Unitedworld School of BusinessMarketing environment - Unitedworld School of Business
Marketing environment - Unitedworld School of Business
 
Class_XII_Account_Business Environment ppt 2020.pdf
Class_XII_Account_Business Environment ppt 2020.pdfClass_XII_Account_Business Environment ppt 2020.pdf
Class_XII_Account_Business Environment ppt 2020.pdf
 
Class_XII_Account_Business Environment ppt 2020.pdf
Class_XII_Account_Business Environment ppt 2020.pdfClass_XII_Account_Business Environment ppt 2020.pdf
Class_XII_Account_Business Environment ppt 2020.pdf
 
Class_XII_Account_Business Environment ppt 2020.pdf
Class_XII_Account_Business Environment ppt 2020.pdfClass_XII_Account_Business Environment ppt 2020.pdf
Class_XII_Account_Business Environment ppt 2020.pdf
 

More from PROF. EMMANUEL DOTONG

TOWS Matrix Analysis - Dr. Emmanuel Dotong.pdf
TOWS Matrix Analysis - Dr. Emmanuel Dotong.pdfTOWS Matrix Analysis - Dr. Emmanuel Dotong.pdf
TOWS Matrix Analysis - Dr. Emmanuel Dotong.pdfPROF. EMMANUEL DOTONG
 
Business Strategies - Dr. Emmanuel Dotong.pdf
Business Strategies - Dr. Emmanuel Dotong.pdfBusiness Strategies - Dr. Emmanuel Dotong.pdf
Business Strategies - Dr. Emmanuel Dotong.pdfPROF. EMMANUEL DOTONG
 
Competitive Profile Matrix - Dr. Emmanuel Dotong.pdf
Competitive Profile Matrix - Dr. Emmanuel Dotong.pdfCompetitive Profile Matrix - Dr. Emmanuel Dotong.pdf
Competitive Profile Matrix - Dr. Emmanuel Dotong.pdfPROF. EMMANUEL DOTONG
 
SWOT Analaysis - Dr. Emmanuel Dotong.pdf
SWOT Analaysis - Dr. Emmanuel Dotong.pdfSWOT Analaysis - Dr. Emmanuel Dotong.pdf
SWOT Analaysis - Dr. Emmanuel Dotong.pdfPROF. EMMANUEL DOTONG
 
Mission and Vision Audit - Dr. Emmanuel Dotong.pdf
Mission and Vision Audit - Dr. Emmanuel Dotong.pdfMission and Vision Audit - Dr. Emmanuel Dotong.pdf
Mission and Vision Audit - Dr. Emmanuel Dotong.pdfPROF. EMMANUEL DOTONG
 
Research Lifehacks by Dr Emmanuel Dotong
Research Lifehacks by Dr Emmanuel DotongResearch Lifehacks by Dr Emmanuel Dotong
Research Lifehacks by Dr Emmanuel DotongPROF. EMMANUEL DOTONG
 
Business Feasibility - Understanding the Marketing Aspect as a Feasibility Ch...
Business Feasibility - Understanding the Marketing Aspect as a Feasibility Ch...Business Feasibility - Understanding the Marketing Aspect as a Feasibility Ch...
Business Feasibility - Understanding the Marketing Aspect as a Feasibility Ch...PROF. EMMANUEL DOTONG
 

More from PROF. EMMANUEL DOTONG (8)

TOWS Matrix Analysis - Dr. Emmanuel Dotong.pdf
TOWS Matrix Analysis - Dr. Emmanuel Dotong.pdfTOWS Matrix Analysis - Dr. Emmanuel Dotong.pdf
TOWS Matrix Analysis - Dr. Emmanuel Dotong.pdf
 
Business Strategies - Dr. Emmanuel Dotong.pdf
Business Strategies - Dr. Emmanuel Dotong.pdfBusiness Strategies - Dr. Emmanuel Dotong.pdf
Business Strategies - Dr. Emmanuel Dotong.pdf
 
Competitive Profile Matrix - Dr. Emmanuel Dotong.pdf
Competitive Profile Matrix - Dr. Emmanuel Dotong.pdfCompetitive Profile Matrix - Dr. Emmanuel Dotong.pdf
Competitive Profile Matrix - Dr. Emmanuel Dotong.pdf
 
Porters Five Forces
Porters Five ForcesPorters Five Forces
Porters Five Forces
 
SWOT Analaysis - Dr. Emmanuel Dotong.pdf
SWOT Analaysis - Dr. Emmanuel Dotong.pdfSWOT Analaysis - Dr. Emmanuel Dotong.pdf
SWOT Analaysis - Dr. Emmanuel Dotong.pdf
 
Mission and Vision Audit - Dr. Emmanuel Dotong.pdf
Mission and Vision Audit - Dr. Emmanuel Dotong.pdfMission and Vision Audit - Dr. Emmanuel Dotong.pdf
Mission and Vision Audit - Dr. Emmanuel Dotong.pdf
 
Research Lifehacks by Dr Emmanuel Dotong
Research Lifehacks by Dr Emmanuel DotongResearch Lifehacks by Dr Emmanuel Dotong
Research Lifehacks by Dr Emmanuel Dotong
 
Business Feasibility - Understanding the Marketing Aspect as a Feasibility Ch...
Business Feasibility - Understanding the Marketing Aspect as a Feasibility Ch...Business Feasibility - Understanding the Marketing Aspect as a Feasibility Ch...
Business Feasibility - Understanding the Marketing Aspect as a Feasibility Ch...
 

Recently uploaded

Lucia Ferretti, Lead Business Designer; Matteo Meschini, Business Designer @T...
Lucia Ferretti, Lead Business Designer; Matteo Meschini, Business Designer @T...Lucia Ferretti, Lead Business Designer; Matteo Meschini, Business Designer @T...
Lucia Ferretti, Lead Business Designer; Matteo Meschini, Business Designer @T...Associazione Digital Days
 
business environment micro environment macro environment.pptx
business environment micro environment macro environment.pptxbusiness environment micro environment macro environment.pptx
business environment micro environment macro environment.pptxShruti Mittal
 
1911 Gold Corporate Presentation Apr 2024.pdf
1911 Gold Corporate Presentation Apr 2024.pdf1911 Gold Corporate Presentation Apr 2024.pdf
1911 Gold Corporate Presentation Apr 2024.pdfShaun Heinrichs
 
Planetary and Vedic Yagyas Bring Positive Impacts in Life
Planetary and Vedic Yagyas Bring Positive Impacts in LifePlanetary and Vedic Yagyas Bring Positive Impacts in Life
Planetary and Vedic Yagyas Bring Positive Impacts in LifeBhavana Pujan Kendra
 
The McKinsey 7S Framework: A Holistic Approach to Harmonizing All Parts of th...
The McKinsey 7S Framework: A Holistic Approach to Harmonizing All Parts of th...The McKinsey 7S Framework: A Holistic Approach to Harmonizing All Parts of th...
The McKinsey 7S Framework: A Holistic Approach to Harmonizing All Parts of th...Operational Excellence Consulting
 
Jewish Resources in the Family Resource Centre
Jewish Resources in the Family Resource CentreJewish Resources in the Family Resource Centre
Jewish Resources in the Family Resource CentreNZSG
 
BAILMENT & PLEDGE business law notes.pptx
BAILMENT & PLEDGE business law notes.pptxBAILMENT & PLEDGE business law notes.pptx
BAILMENT & PLEDGE business law notes.pptxran17april2001
 
Go for Rakhi Bazaar and Pick the Latest Bhaiya Bhabhi Rakhi.pptx
Go for Rakhi Bazaar and Pick the Latest Bhaiya Bhabhi Rakhi.pptxGo for Rakhi Bazaar and Pick the Latest Bhaiya Bhabhi Rakhi.pptx
Go for Rakhi Bazaar and Pick the Latest Bhaiya Bhabhi Rakhi.pptxRakhi Bazaar
 
Healthcare Feb. & Mar. Healthcare Newsletter
Healthcare Feb. & Mar. Healthcare NewsletterHealthcare Feb. & Mar. Healthcare Newsletter
Healthcare Feb. & Mar. Healthcare NewsletterJamesConcepcion7
 
Cybersecurity Awareness Training Presentation v2024.03
Cybersecurity Awareness Training Presentation v2024.03Cybersecurity Awareness Training Presentation v2024.03
Cybersecurity Awareness Training Presentation v2024.03DallasHaselhorst
 
Traction part 2 - EOS Model JAX Bridges.
Traction part 2 - EOS Model JAX Bridges.Traction part 2 - EOS Model JAX Bridges.
Traction part 2 - EOS Model JAX Bridges.Anamaria Contreras
 
NAB Show Exhibitor List 2024 - Exhibitors Data
NAB Show Exhibitor List 2024 - Exhibitors DataNAB Show Exhibitor List 2024 - Exhibitors Data
NAB Show Exhibitor List 2024 - Exhibitors DataExhibitors Data
 
Intermediate Accounting, Volume 2, 13th Canadian Edition by Donald E. Kieso t...
Intermediate Accounting, Volume 2, 13th Canadian Edition by Donald E. Kieso t...Intermediate Accounting, Volume 2, 13th Canadian Edition by Donald E. Kieso t...
Intermediate Accounting, Volume 2, 13th Canadian Edition by Donald E. Kieso t...ssuserf63bd7
 
Driving Business Impact for PMs with Jon Harmer
Driving Business Impact for PMs with Jon HarmerDriving Business Impact for PMs with Jon Harmer
Driving Business Impact for PMs with Jon HarmerAggregage
 
Pitch Deck Teardown: Xpanceo's $40M Seed deck
Pitch Deck Teardown: Xpanceo's $40M Seed deckPitch Deck Teardown: Xpanceo's $40M Seed deck
Pitch Deck Teardown: Xpanceo's $40M Seed deckHajeJanKamps
 
Appkodes Tinder Clone Script with Customisable Solutions.pptx
Appkodes Tinder Clone Script with Customisable Solutions.pptxAppkodes Tinder Clone Script with Customisable Solutions.pptx
Appkodes Tinder Clone Script with Customisable Solutions.pptxappkodes
 
Excvation Safety for safety officers reference
Excvation Safety for safety officers referenceExcvation Safety for safety officers reference
Excvation Safety for safety officers referencessuser2c065e
 
1911 Gold Corporate Presentation Apr 2024.pdf
1911 Gold Corporate Presentation Apr 2024.pdf1911 Gold Corporate Presentation Apr 2024.pdf
1911 Gold Corporate Presentation Apr 2024.pdfShaun Heinrichs
 
Effective Strategies for Maximizing Your Profit When Selling Gold Jewelry
Effective Strategies for Maximizing Your Profit When Selling Gold JewelryEffective Strategies for Maximizing Your Profit When Selling Gold Jewelry
Effective Strategies for Maximizing Your Profit When Selling Gold JewelryWhittensFineJewelry1
 

Recently uploaded (20)

Lucia Ferretti, Lead Business Designer; Matteo Meschini, Business Designer @T...
Lucia Ferretti, Lead Business Designer; Matteo Meschini, Business Designer @T...Lucia Ferretti, Lead Business Designer; Matteo Meschini, Business Designer @T...
Lucia Ferretti, Lead Business Designer; Matteo Meschini, Business Designer @T...
 
business environment micro environment macro environment.pptx
business environment micro environment macro environment.pptxbusiness environment micro environment macro environment.pptx
business environment micro environment macro environment.pptx
 
1911 Gold Corporate Presentation Apr 2024.pdf
1911 Gold Corporate Presentation Apr 2024.pdf1911 Gold Corporate Presentation Apr 2024.pdf
1911 Gold Corporate Presentation Apr 2024.pdf
 
WAM Corporate Presentation April 12 2024.pdf
WAM Corporate Presentation April 12 2024.pdfWAM Corporate Presentation April 12 2024.pdf
WAM Corporate Presentation April 12 2024.pdf
 
Planetary and Vedic Yagyas Bring Positive Impacts in Life
Planetary and Vedic Yagyas Bring Positive Impacts in LifePlanetary and Vedic Yagyas Bring Positive Impacts in Life
Planetary and Vedic Yagyas Bring Positive Impacts in Life
 
The McKinsey 7S Framework: A Holistic Approach to Harmonizing All Parts of th...
The McKinsey 7S Framework: A Holistic Approach to Harmonizing All Parts of th...The McKinsey 7S Framework: A Holistic Approach to Harmonizing All Parts of th...
The McKinsey 7S Framework: A Holistic Approach to Harmonizing All Parts of th...
 
Jewish Resources in the Family Resource Centre
Jewish Resources in the Family Resource CentreJewish Resources in the Family Resource Centre
Jewish Resources in the Family Resource Centre
 
BAILMENT & PLEDGE business law notes.pptx
BAILMENT & PLEDGE business law notes.pptxBAILMENT & PLEDGE business law notes.pptx
BAILMENT & PLEDGE business law notes.pptx
 
Go for Rakhi Bazaar and Pick the Latest Bhaiya Bhabhi Rakhi.pptx
Go for Rakhi Bazaar and Pick the Latest Bhaiya Bhabhi Rakhi.pptxGo for Rakhi Bazaar and Pick the Latest Bhaiya Bhabhi Rakhi.pptx
Go for Rakhi Bazaar and Pick the Latest Bhaiya Bhabhi Rakhi.pptx
 
Healthcare Feb. & Mar. Healthcare Newsletter
Healthcare Feb. & Mar. Healthcare NewsletterHealthcare Feb. & Mar. Healthcare Newsletter
Healthcare Feb. & Mar. Healthcare Newsletter
 
Cybersecurity Awareness Training Presentation v2024.03
Cybersecurity Awareness Training Presentation v2024.03Cybersecurity Awareness Training Presentation v2024.03
Cybersecurity Awareness Training Presentation v2024.03
 
Traction part 2 - EOS Model JAX Bridges.
Traction part 2 - EOS Model JAX Bridges.Traction part 2 - EOS Model JAX Bridges.
Traction part 2 - EOS Model JAX Bridges.
 
NAB Show Exhibitor List 2024 - Exhibitors Data
NAB Show Exhibitor List 2024 - Exhibitors DataNAB Show Exhibitor List 2024 - Exhibitors Data
NAB Show Exhibitor List 2024 - Exhibitors Data
 
Intermediate Accounting, Volume 2, 13th Canadian Edition by Donald E. Kieso t...
Intermediate Accounting, Volume 2, 13th Canadian Edition by Donald E. Kieso t...Intermediate Accounting, Volume 2, 13th Canadian Edition by Donald E. Kieso t...
Intermediate Accounting, Volume 2, 13th Canadian Edition by Donald E. Kieso t...
 
Driving Business Impact for PMs with Jon Harmer
Driving Business Impact for PMs with Jon HarmerDriving Business Impact for PMs with Jon Harmer
Driving Business Impact for PMs with Jon Harmer
 
Pitch Deck Teardown: Xpanceo's $40M Seed deck
Pitch Deck Teardown: Xpanceo's $40M Seed deckPitch Deck Teardown: Xpanceo's $40M Seed deck
Pitch Deck Teardown: Xpanceo's $40M Seed deck
 
Appkodes Tinder Clone Script with Customisable Solutions.pptx
Appkodes Tinder Clone Script with Customisable Solutions.pptxAppkodes Tinder Clone Script with Customisable Solutions.pptx
Appkodes Tinder Clone Script with Customisable Solutions.pptx
 
Excvation Safety for safety officers reference
Excvation Safety for safety officers referenceExcvation Safety for safety officers reference
Excvation Safety for safety officers reference
 
1911 Gold Corporate Presentation Apr 2024.pdf
1911 Gold Corporate Presentation Apr 2024.pdf1911 Gold Corporate Presentation Apr 2024.pdf
1911 Gold Corporate Presentation Apr 2024.pdf
 
Effective Strategies for Maximizing Your Profit When Selling Gold Jewelry
Effective Strategies for Maximizing Your Profit When Selling Gold JewelryEffective Strategies for Maximizing Your Profit When Selling Gold Jewelry
Effective Strategies for Maximizing Your Profit When Selling Gold Jewelry
 

PEST Analysis - Emmanuel Dotong.pdf

  • 1. MODULE 2: MACROENVIRONMENT: PEST ANALYSIS STRATEGIC MANAGEMENT DR. EMMANUEL DOTONG Associate Professor of Business ejdotong@alum.up.edu.ph STRATEGIC TOOLS AND MODELS
  • 2. Module Coverage 01 02 Business Macroenvironment PEST ANALYSIS MODULE 2: PESTLE ANALYSIS 03 PEST ANALYSIS APPLICATION
  • 4. BUSINESS MACROENVIRONMENT The macroenvironment refers to the broader external factors and conditions beyond a company's immediate control that influence its operations, strategies, and overall business environment. These factors include economic, political, social, technological, legal, and environmental elements that collectively shape the context in which an organization operates. POLITICAL ENVIRONMENT ECONOMIC SOCIAL TECHNOLOGICAL ENVIRONMENT ENVIRONMENT ENVIRONMENT
  • 6. PEST ANALYSIS PEST ENVIRONMENT ECONOMICAL FACTORS Involve the financial conditions and trends that affect businesses, including aspects like growth rates, inflation, and consumer spending patterns. TECHNOLOGICAL FACTORS Encompass the advancements and innovations in technology that impact industries, influencing business strategies and operations. POLITICAL AND LEGAL FACTORS Encompass the governmental and regulatory influences that impact business operations and decisions within a specific region or country. SOCIAL FACTORS Encompass the cultural, demographic, and societal influences that affect consumer behavior and shape market trends. MACROENVIRONMENT FACTORS
  • 7. MACROENVIRONMENT § PEST analysis serves as a valuable strategic framework, systematically assessing the impact of external macro-environmental elements on businesses or industries. § By scrutinizing Political, Economic, Social, and Technological factors, it empowers organizations with a comprehensive understanding of the larger context in which they operate. This informed perspective aids decision-making and facilitates strategic planning by highlighting potential challenges, opportunities, and changes influenced by these factors. § PEST analysis equips businesses to proactively adapt, capitalize on emerging trends, and mitigate risks associated with their operating environment. PEST ANALYSIS
  • 8. POLITICAL AND LEGAL FACTORS PEST ANALYSIS § Government Grants And Incentives § Changes In Government Leadership § Corruption Levels And Transparency § Government – Business Partnerships § Intellectual Property Enforcement § National Security And Defense Policies § Local And National Election § War And Terrorism § Campaign Finance Regulations § Trade Sanctions And Embargoes § Immigration And Work Permit Regulations § Cybersecurity Laws And Regulations § Land Use And Zoning Regulations § E-commerce Business Regulations § Discrimination Regulations § Employment Laws & Regulations § Contract & Commercial Law § Intellectual Property Rights § Health & Safety Regulations § Data Protection & Privacy Laws § Competition Laws & Antitrust § Consumer Protection Laws § Environmental Regulations § Import & Export Regulations § Licensing & Accreditation Permits § Diversity Regulations § Tax Laws & Regulations § Product Liability & Quality Standards § International Trade Laws & Treaties § Employee Rights And Labor Laws
  • 9. ECONOMIC FACTORS § Foreign direct investment inflows and outflows § Government budget deficit or surplus § Public debt-to-GDP ratio § Private sector credit growth § Stock market indices and trends § Bond market yields and trends § Interest rates (short-term and long-term) § Real estate market trends § Exchange rate trends and volatility § Sovereign credit rating § Investment rate § Manufacturing output and capacity utilization § Retail sales growth § Industrial production growth § Balance of trade and balance of payments § Capital expenditure trends § GDP growth rate § Inflation rate § Consumer Price Index (CPI) § Producer Price Index (PPI) § Unemployment rate § Labor force participation rate § Employment-to-population ratio § Wage growth rate § Productivity growth rate § Central bank policy rates § Money supply § Commodity prices § Savings rate § Consumer confidence index § Business sentiment index § Export and import growth rates PEST ANALYSIS
  • 10. SOCIAL FACTORS § Demographic lifestyles § Cultural diversity and multiculturalism § Urbanization and rural migration § Consumer attitudes towards sustainability § Health and wellness trends § Educational attainment and literacy rates § Lifestyle preferences and leisure activities § Traditions and customs § Attitudes towards work-life balance. § Aging population and retirement trends. § Changing gender roles and equality. § Social values and ethical considerations § Adoption of new social norms § Buying habits § Impact of social media on consumer behavior § Cultural values and norms § Social media and digital communication trends § Cultural perceptions of products and brands § Attitudes towards entrepreneurship § Attitude Towards Eco-friendly Products § Age distribution and generational preferences § Cultural integration in global markets § Cultural influences on consumer behavior § Cultural taboos and sensitivities § Cross-cultural communication challenges § Age distribution by cohorts § Birth rates and fertility rates § Death rates and life expectancy § Population density and urbanization rates § Ethnic and racial composition § Educational levels and enrollment rates PEST ANALYSIS
  • 11. § Rate of Technological Change § Disruptive Technologies § Research and Development (R&D) Funding § Innovation Ecosystem § Intellectual Property Protection § Digital Transformation § Technology Transfer § Open-Source Collaboration § Automation Potential § Technological Infrastructure § Technological Convergence § Skills Gap & Industry 4.0 § Biotechnology Advancements § Nanotechnology Potential § Quantum Computing and Genetic Engineering § Renewable Energy Innovations § Space Technology § Augmented and Virtual Reality § Cybersecurity Advancements § Internet of Things (IoT) Growth § 5G and Connectivity Expansion § Artificial Intelligence (AI) Progress § Machine Learning Applications § Big Data Analytics § Cloud & Cognitive Computing Adoption § Blockchain Technology § Autonomous Vehicles Development § Sustainable Technology Solutions § Health Tech Innovations § E-commerce Innovations § Robotics Advancements § Smart Cities Initiatives § Wearable Technology Trends § Clean Energy Technologies § Virtual Healthcare Services § Educational Technology (EdTech) TECHNOLOGICAL FACTORS PEST ANALYSIS
  • 13. PEST ANALYSIS APPLICATION Examines Political, Economic, Social, and Technological factors to identify opportunities and threats, providing valuable insights for informed decision-making and planning. 01 02 03 IDENTIFY EXTERNAL FACTORS ANALYZE THE BUSINESS IMPLICATION DEFINE SCOPE AND PURPOSE Determine whether the analysis is focused on a specific project, business, industry, or market. This clarifies the context for which the analysis is being conducted. Recognize the primary external influences that impact the industry your company belongs: Political, Economic, Social, and Technological (PEST) factors. These factors collectively shape the broader context within which the subject operates. Evaluate the impact of each identified factor. Understand how political, economic, social, and technological forces can influence operations, opportunities, and challenges. Translate these insights into actionable strategies to guide decision- making and planning.
  • 14. PEST ANALYSIS E1 Minimum Wage Increase E2 High Inflation Rate E3 Increase in Supply Chain Cost ECONOMIC FACTORS T1 Social Media Trends T2 Online Reservation Systems T3 New Smart Kitchen Technologies TECHNOLOGICAL FACTORS P1 Revised Public Establishments Smoking Policy P2 Revised Tax Policies for Alcoholic Beverages P3 Active Public Health Campaigns POLITICAL FACTORS S1 Health and Wellness Trends S2 Consumer’s Digital Dependence S3 Active Cultural Events and Holidays SOCIAL FACTORS MACROENVIRONMENT FACTORS
  • 15. A NA L Y S I S P E S T P1 Revised Public Establishments Smoking Policy All indoor public establishments, including restaurants, bars, and entertainment venues, are now required to be smoke-free environments. This change aligns with growing health awareness trends and aims to provide clean and safe spaces for patrons and employees (De la Cruz, 2023) E1 Minimum Wage Increase The Philippines has announced a 20-peso increase in the minimum wage in Metro Manila to address rising living costs and enhance worker compensation, aiming to improve their quality of life. While this move positively impacts workers, businesses may need to navigate higher labor costs and potential shifts in consumer spending (Dotong, 2023). S1 Health and Wellness Trends The landscape of health and wellness is in constant flux, influenced by shifting consumer choices, technological progress, and a heightened focus on overall well-being. This is evident in trends like the rise of plant-centric diets, tailored nutrition plans, the surge in non-alcoholic consumption, and the demand for clear nutritional information (Jimenez, 2023). T1 New Smart Kitchen Technologies Smart kitchen technologies are transforming the operations of restaurants and bars, improving efficiency, customer experiences, and safety. These include Kitchen Management Systems, Smart Kitchen Appliances, Temperature and Monitoring Sensors, Kitchen Display Systems (KDS), Digital Recipe Management, Voice-Activated Assistants, Smart Dishwashers, Allergen and Dietary Preference Management, and Waste Management Solutions, and others (Ocampo, 2023)
  • 16. P1 BUSINESS IMPLICATIONS If a significant portion of regular patrons are smokers, the policy change might lead to a temporary drop in revenue during the adjustment period. Initial Revenue Dip Inadequate implementation might result in legal consequences, fines, or damage to the reputation of the company. Regulatory Compliance Some patrons might perceive the policy as restrictive, affecting the company’s traditional image and appeal. Change in Public Perception Implementing the policy requires training staff, adjusting outdoor areas, and enforcing new rules, which could strain resources. Resource Allocation Enforcing a smoke-free policy aligns with health trends, portraying the establishment as a responsible and health-conscious establishment. Health-Conscious Image A smoke-free environment attracts non-smokers, families, and health-conscious individuals, potentially increasing foot traffic and revenue. Broader Customer Base Providing a smoke-free workplace enhances the health and job satisfaction of employees, contributing to a positive work environment. Improved Employee Well-being Smoke-free air improves the overall dining and socializing experience, making the establishment more appealing to a wider audience. Enhanced Customer Experience Business Implications Revised Public Establishments Smoking Policy Adaptation and strategic planning can help bars successfully navigate these changes and create healthier and more welcoming environments for their patrons. Political Factor Evaluation
  • 17. E1 BUSINESS IMPLICATIONS Higher wages lead to increased labor expenses, potentially impacting the establishment’s profitability. Increased Labor Costs Rising labor costs might necessitate price hikes on menu items, potentially deterring price-sensitive customers. Repricing Pressure If competitors don't match the wage increase, the establishment might face challenges in retaining and attracting staff. Competitive Challenges Smaller establishments with limited financial flexibility might struggle to accommodate sudden wage increases. Budget Constraints Higher wages can boost employee morale, leading to increased job satisfaction, engagement, and lower turnover rates. Improved Employee Morale Employees earning more can lead to increased disposable income, potentially boosting patronage to the establishment. Consumer Spending Boost Motivated and satisfied employees may provide better customer service, resulting in improved dining experiences. Enhanced Quality of Work Demonstrating commitment to fair wages can enhance the establishment’s reputation, attracting socially conscious customers. Positive Public Image Business Implications Minimum Wage Increase Careful planning, considering the establishment’s financial health and customer base, can help mitigate potential negatives and leverage the positives for overall business success. Economic Factor Evaluation
  • 18. T1 BUSINESS IMPLICATIONS Acquiring and implementing smart kitchen technologies can be costly, potentially straining budgets High Initial Investment Staff requires training to operate and troubleshoot the technology effectively, leading to additional time and effort. Training Requirements Malfunctions or technical glitches might disrupt operations and lead to customer dissatisfaction. Technical Issues Automation could lead to concerns about job displacement among staff responsible for manual tasks. Job Displacement Concerns Smart kitchen technologies streamline operations, reducing preparation time and improving overall efficiency. Enhanced Efficiency Automation and streamlined processes might lead to lower labor requirements, positively impacting costs. Reduced Labor Costs Faster service, accurate orders, and consistent quality contribute to an improved dining experience. Enhanced Customer Experience Smart technologies encourage experimentation with new cooking techniques and menu items. Innovation Opportunities Business Implications New Smart Kitchen Technologies Navigating the adoption of smart kitchen technologies requires careful assessment of benefits and drawbacks. Proper planning, staff training, and contingency measures can help maximize the positive impacts while mitigating potential challenges. Technological Factor Evaluation
  • 19. END Thank you for Listening! ASSOC. PROF. EMMANUEL DOTONG Management Consultant ejdotong@alum.up.edu.ph