1.5 external environment steeple analysis. external factors that impact business a framework for...

1.5 External Environment

STEEPLE Analysis

External Factors that Impact BusinessExternal Factors that Impact Business

A framework for analyzing the external A framework for analyzing the external environmental factors affecting business environmental factors affecting business objectives and strategies.objectives and strategies.

SSocialocial

TTechnologicalechnological

EEconomicconomic

EEnvironmentalnvironmental

PPoliticalolitical

LLegalegal

EEthicsthics


Social IssuesSocial Issues

Population demographicsPopulation demographicsRole of womenRole of womenImproved EducationImproved EducationRetirementRetirementDivorce/Marital ratesDivorce/Marital ratesJob securityJob securityImmigrationImmigration

Can you think of anything in this category that has Can you think of anything in this category that has currently affected business?currently affected business?


Impact of TechnologyImpact of TechnologyIT's role in:IT's role in:

product developmentproduct developmentCommuniction (voice and data)Communiction (voice and data)Developing new and better processesDeveloping new and better processesCost benefitsCost benefitsCompetitive advantageCompetitive advantageOutsource and offshoringOutsource and offshoringCAD/CAMCAD/CAMImpact on laborImpact on labor



Economic InfluencesEconomic Influences

Economic GrowthEconomic Growth

Rising or falling living standardsRising or falling living standards

Low or high levels of unemploymentLow or high levels of unemployment

Value of imports/exportsValue of imports/exports



Environmental InfluencesEnvironmental Influences

Environmental controls on business activities such as Environmental controls on business activities such as waste disposal, use of sustainable energy, reducing waste disposal, use of sustainable energy, reducing packagingpackaging

Threats from natural events such as drought, Threats from natural events such as drought, earthquakes, and floodsearthquakes, and floods

Natural resourcesNatural resources

Infrastructure – such asroad and air transport facilitiesInfrastructure – such asroad and air transport facilities



Political IssuesPolitical Issues

Government stabilityGovernment stability

Form of political structure (democracy, dictatorship?)Form of political structure (democracy, dictatorship?)

Government's attitude to private ownershipGovernment's attitude to private ownership

Trade policies and membership of free-trade areas or Trade policies and membership of free-trade areas or customs unioncustoms union



Legal IssuesLegal Issues

Employment lawsEmployment laws

Consumer Protection LawsConsumer Protection Laws

Business competition LawsBusiness competition Laws

Policy changes (legalizing same-sex marriage, Policy changes (legalizing same-sex marriage, marijuana, medical insurance)marijuana, medical insurance)



EthicsEthics

Child laborChild labor

Corrupt business practicesCorrupt business practices

Advertising and promotion techniquesAdvertising and promotion techniques


Other TermsOther Terms

RecessionRecession Six months of falling GDPSix months of falling GDP

Cost-push InflationCost-push Inflation rising costs of forces businessrising costs of forces businessto increase pricesto increase prices

Demand-pull InflationDemand-pull Inflation excess demand allows excess demand allows businessbusiness

to increase pricesto increase prices

UnemploymentUnemployment people in an economy that people in an economy that are are

willing and able to work, butwilling and able to work, butcannot find employmentcannot find employment

Interest rateInterest rate percentage charge by financialpercentage charge by financialinstitution when lending moneyinstitution when lending money

InflationInflation the rate of change in thethe rate of change in theaverage level of pricesaverage level of prices

Other TermsOther Terms

Fiscal policyFiscal policy Changes in governmentChanges in governmentspending levels and tax ratesspending levels and tax rates

Monetary policyMonetary policy changes in the level of changes in the level of interestinterest

rates which make loan capitalrates which make loan capitalmore or less expensivemore or less expensive

Exchange ratesExchange rates increases or decreases in theincreases or decreases in thevalue of a currency againstvalue of a currency againstother currencies.other currencies.

CADCAD using computers and IT whenusing computers and IT whenComputer-aided designComputer-aided design designing productsdesigning products

CAMCAM the use of computers and the use of computers and Computer-aided manufacturingComputer-aided manufacturing computer-controlledcomputer-controlled

machinery to speed up the machinery to speed up the production process and makeproduction process and makeit more flexibleit more flexible

1.5 external environment steeple analysis. external factors that impact business a framework for...

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