Question

This should integrate ideas from week 2 with your own personal strategy safari - go out into the world and find strategy first hand, then tell the class about it! Find an example of a company that has recently been, or is likely to be, deeply impacted by one of the 6 PESTEL factors. Clearly outline how the Workshop/Chapter 2 concepts apply to your example.

Answer 1

In the modern-day corporations have prioritized on the application of PESTLE analysis tool so as to ascertain the nature of the external market environment in which they are operating. As a result, the use of PESTLE analysis has enabled businesses to understand the external market as well as formulate strategies to harness their competitiveness. The following paper will assessment of impacts associated to one of the PESTLE factors precisely the economic factor towards Apple Inc.

The rising cost of labor is one of the common economic factors that have been deeply affecting Apple Corporation (Yan, 2016). This contention rests on the fact that the cost of hiring labor who works in Apple’s plants is on the rise resulting in the reduction of the annual revenue generated by the organization. For example, Apple’s plants in China and United States are now incurring extra costs in paying the workforce compared to past years.

Additionally, changes in the exchange rate and corporate tax as another economic factor also have been adversely affecting the firm (Rahn, 2016). The fluctuation of the exchange rates and corporate tax causes an increase in the expenses incurred by the company hence making Apple products expensive in the global market. This aspect, in turn, reduces the sales output of the enterprise and the overall revenue generated by the company.

Lastly, the inflation rate in the marketplace also has been deeply affecting the company. The current inflation rate has resulted in the decline of the demand for the Apple products by consumers. Thus, due to the decrease in the demand level the organization has witnessed a decline in the sale output as well as the profit generated by the company.

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