October 25-29
Dear students, for this weekly forum we will discuss about: MACRO ENVIRONMENT
You must answer one or both questions with a response of at least 200 words and using at least one reference in APA style.
A) What are the consequences of not knowing completely the macroenvironment of your business?
B) Which element of the PESTEL model do you consider is the most important and why?
Remember that our deadline is Friday, October 29th before 11:59 pm. :)
PUT YOUR NAME AND LAST NAME IN YOUR ANSWER.
Best regards!
Samantha Razu
ResponderBorrarEvery business is affected by various factors, this aspects can’t be separated and they make up a whole. The business environment is part of a large entity called the macro-environment, which affects the operations of all existing businesses out there. To grow and develop a business you need to know and take in count every aspect of the market, and the macro-environment is the analyze of all of this important external aspects for the proper development of a company. Having no knowledge or not taking in count what the market wants or needs is just something that will affect your business and won’t let you progress. Some of the most important aspects to take in count on the macro-environment of a company are:
• Organization: the structure and form of management the business is following, without this there wouldn’t be a proper order.
• Demographic: knowing the public and what they need, to develop any product or service you need to know the audience you are looking for and satisfy their necessities.
• Technological: development of the technology within the company, improves need to be constantly in development.
• Competition: you need to know your rivals and how to develop a better product or service.
• Economy: knowing your prices and budgets is a must.
• Cultural values: the environment that surrounds the market is also important to take in count:
• Politics: following the legal orders and not committing something illegal or out of jurisdiction.
Summer. October 01. 2021. Understanding Macro Factors.
https://www.mageplaza.com/blog/micro-and-macro-factors-affect-your-business.html
Pamela Barrera Goyri
ResponderBorrarIn the macro-environment, new risk factors are constantly appearing and they are much more difficult to identify, both for the managers of the business as well as for lenders. The major changes or developments in the macro-environment are usually outside the business’ control. It’s essential that the managers of the business are able to anticipate the impact of these changes on either the business itself or on its market before they actually happen, so as to be able to adjust the business’ products or processes accordingly. As part of our credit risk assessment we must ensure that the management of the business is aware of possible changes in its macro-environment since failure to do so may result in the business losing any competitive advantage that it might have had and compromising its very existence. The macro-environment is more general - it is the environment in the economy itself. It has an effect on how all business groups operate, perform, make decisions, and form strategies simultaneously. It is quite dynamic, which means that a business has to constantly track its changes. Macro environment analysis is part of a company's strategic management that enables it to analyze and identify potential opportunities and hazards that might impact the business. The goal is to prepare management in advance with information that assists them in making operational decisions.
https://www.linkedin.com/pulse/understanding-impact-macro-environment-factors-essential-geoff-burton
https://www.mageplaza.com/blog/micro-and-macro-factors-affect-your-business.html
Itzel Kumul
ResponderBorrarI think the most important elements of the PESTEL model are technological and political, the technological aspect is important because nowadays our world revolves around technology and everything we use is made with it, which is why it is very important for the industry to keep a relationship with technological advances to stay updated and to keep innovating for the industry not to go obsolete, it is also important because using technology helps companies stay valid for them not to lose position in the market, in the other hand politics are also important almost as much as technology because they participate in keeping the industry at peace, for the industry to work in a pacific, ethical and equitable way we use politics that help establish important agreements between nations that work in the same industry, when there are differences between countries it is important to use these political agreements that where previously stablished to make and maintain the order and to avoid a potential debate between nations.
“Amable T. May 15 2018. The importance of a PESTEL analysis, recovered from https://www.girlfridayz.com/post/the-importance-of-a-pestel-analysis”
Mariette Colli
ResponderBorrarIt is important that you take into consideration and acknowledge your business's macro-environment, otherwise, your business can undergo. The external factor changes can be either be good or bad for the business but because these external factors are not under our control, we can't expect to be able to pass over them, so it is even worst when we don't know what we will do or happen when these factors make changes which influence in our business. Not taking into account the macro-environment will head us to inefficient strategies. Where we have the opportunity to analyze possible actions in order to take advantage of the changes like generate more incomes, reduce expenses, obtain better deals. But instead because of the inefficiency, your business may miss the opportunities. You also won't be able to know the possible threats to your business. This can significantly bring down your business performance and economy, since you won't know what alternative best fit to smooth out the impact on your business, were again, you could've analyzed even initial deals, changes, decisions that you may take in time and lower the negative effect it has on your company as much as possible. Therefore, your decision making is also compromised for the worst.
References:
Abhijeet Pratap. (2020, January 17). Role of Macroenvironmental Forces in Business . Retrieved October 26, 2021, from notesmatic website: https://notesmatic.com/role-of-macroenvironmental-forces-in-business/
What Is a Macro Environment? (2021). Retrieved October 26, 2021, from Investopedia website: https://www.investopedia.com/terms/m/macro-environment.asp
Macro Environment - Definition, Understanding, and Why Macro Environment is Important? (2019). Retrieved October 26, 2021, from Cleartax.in website: https://cleartax.in/g/terms/macro-environment
Joseluis:
ResponderBorrarThe problem of not knowing that it is a macro envirorment is a big problem and not only because it affects you externally but rather internally, it is something that gives serious consequences to the company to the business because it can affect us in several ways considering that a macro enviroment comes from 6 aspects that are: demographic, technological, competition, economy, cultural values and politics.
For example, politics of the same company or the country where this business is located, for example if we are in Mexico and there is a law that prohibits the manufacture of blue things, well, it has to be respected so as not to be affected.
You have to understand the technology whether it is used for sale or for your own benefit. You have to take into account what your competition is because in this business world you will always see someone who is going to be the competition and you have to understand where you can beat them, whether in better prices or items. If we do not know this affects us in sales, that the competition is better, and that is where it begins to affect us economically. If there is no good management of the company.
If we do not know what a macro environment is, we hurt ourselves, by not knowing the policies, competition, economic management, cultural values among others, the consequence will be not to continue growing as a company, to stagnate or even worse not to have economic benefits.
Of the PESTEL model for me the most important letter is the S the social because we learn what the client needs, their values, beliefs and traditions that are around their environment. It helps us to relate to the client and be able to take advantage of what we know they like and what they need.
Understanding of micro and macro factors that affect your business. (n.d.). Mageplaza.Com. Retrieved October 26, 2021, from https://www.mageplaza.com/blog/micro-and-macro-factors-affect-your-business.html
Lorena Traconis
ResponderBorrarThe macro-environment refers to how the macroeconomic conditions in which a company or sector operates influence its performance. Macroeconomics deals with aggregate production, spending, and the price level in an economy as opposed to individual industries and markets.
The amount of the macro environment's influence depends on how much of a company's business is dependent on the health of the overall economy. Cyclical industries are heavily influenced by the macro environment, while basic staple industries are less influenced. Industries that are highly dependent on credit to finance purchases and business investments are strongly influenced by changes in interest rates and global financial markets.
The macro-environment can also directly affect consumers’ ability and willingness to spend. Luxury goods industries and big-ticket consumer goods can be highly impacted by fluctuations in consumer spending. Consumers’ reactions to the broad macro-environment are closely monitored by businesses and economists as a gauge for an economy’s health.
Analyzing the macro environment is an important part of strategic management. Business analysts often conduct a PEST (political, economic, socio-cultural, and technological) analysis to identify macro-economic factors that currently affect or in the future may affect business. Some of the key factors composing the macro environment include the following: Gross Domestic Product, Inflation, Employment, Consumer Spending, Monetary Policy, Fiscal Policy.
https://www.investopedia.com/terms/m/macro-environment.asp
María Paula Muntané
ResponderBorrarA PESTEL analysis is an acronym for a tool that is used to recognize an organization's macro external forces.
This is often used to discover prospective threats, weaknesses, strengths and opportunities.
The PESTEL analysis has six components:
1. Political Aspects
These determine the impact of the government and policies on an organization or a particular industry.
2. Economy aspects
An economic element has a big impact on the economy and its performance, which results in the company's profitability.
3. Factors of the Social Environment
The emphasis here is on spotting new patterns in the social environment (trends).
4. Technological Aspects
Technical aspects take into account the rate of technological innovation and development that may have an impact on a market or an organization. Changes in digital or mobile technologies, automation, and research and innovation could all be factors.
5. Factors Affecting the Environment
Environmental variables are those that are affected by the environment around them, as well as the impact of ecological factors.
6. Legal Aspects
An organization must be aware of what is legal in the jurisdictions in which it operates. They must also be aware of any legislative changes and how they are affected.
For me the most important element in the PESTEL analysis, are all because I Think that the six elements are very important and that a business can’t live without them so I can’t choose one but if I need to choose I’ll choose economical aspects because I think that the goal of any business is to make money, and if you don’t have money the business is going to fail.
Barrington, R. (2021, October 20). What is a PESTEL analysis? Oxford College of Marketing Blog. Retrieved October 28, 2021, from https://blog.oxfordcollegeofmarketing.com/2016/06/30/pestel-analysis/
What is PESTLE Analysis? - Professional Futures. (2018, January 2). Lynsey. Retrieved October 28, 2021, from https://www.professional-futures.com/2018/01/02/what-is-pestle-analysis/
Which is the Most Critical Factor in Strategy Analysis. (n.d.). Future. Retrieved October 28, 2021, from http://futureofcio.blogspot.com/2015/10/which-is-most-critical-factor-in.html
Andrea xacur
ResponderBorrarThe micro-environment is basically the environment that has a direct impact on your business. The macro-environment is more general - it is the environment in the economy itself. It has an effect on how all business groups operate, perform, make decisions, and form strategies simultaneously. The macro-environment may also have a direct impact on the individual’s ability to consume and the sense of willing to spend. Macro environment will have a major impact on the industries and sectors that are big-ticket oriented and are significantly affected by the variation in the consumer’s spending habits. Consumer’s spending reactions based on the very broad macro environment will be closely watched by the corporates, economists and analysts as a measure of the economy's health. The macro-environment of a firm consists of major uncontrollable forces that affect its decision making and performance. There are six major macro-environmental factors affecting the decision making and performance of a firm. They are economic, demographic, sociocultural, technological, natural and political forces. While these forces are outside the control of businesses, considering their influence and forming a business strategy accordingly helps minimize their negative impact. The importance of these factors increases because of the fact that they are outside the firms’ control and can have a positive or negative impact on their performance. Investing time in understanding the impact and its level helps managers build better strategies and improve business performance.
https://www.mageplaza.com/blog/micro-and-macro-factors-affect-your-business.html
https://cleartax.in/g/terms/macro-environment
https://notesmatic.com/role-of-macroenvironmental-forces-in-business/
Angélica Zavala García 2°A
ResponderBorrarB) Which element of the PESTEL model do you consider is the most important and why?
PESTEL is an anagram, it reflects the names of the six segments of the general environment:
1. Political: include elements such as tax policies, changes in tariffs, and the stability of governments.
2. Economic: include elements such as interest rates, unemployment rates, levels of disposable income, the general growth or decline of the economy, etc.
3. Social: include trends in demographics such as population size, age, and ethnic mix, as well as cultural trends such as attitude toward obesity and consumer activism.
4. Technological: include changes in the rate of new product development, advancements in service industry delivery, and others.
5. Environmental: include natural disasters and weather patterns.
6. Legal: include laws involving issues such as employment, health and safety, discrimination, and antitrust.
It´s analysis is an important tool that helps to identify major opportunities and threats that will influence industries and firms, so that wise executives can carefully examine each of these six and then adjust their firms’ strategies accordingly.
Obviously all six elements are fairly important because they help you, as a business owner, make sure that your industry will be successful, but personally I think that most important element of this model is “Technological”. Our world revolves around technology nowadays and it is just going to keep increasing with all the new developments, technological factors help you to be aware at every update of how you´re doing in the market, the rate the product has, etc. If you´re not in touch with technology, your company is going to be lagging behind.
References
Edwards, J. (2014, September 12). Evaluating the General Environment – Mastering Strategic Management – 1st Canadian Edition. Pressbooks. Retrieved October 28, 2021, from https://opentextbc.ca/strategicmanagement/chapter/evaluating-the-general-environment/#fig3.3
Este comentario ha sido eliminado por el autor.
ResponderBorrarVictor Arjona
ResponderBorrarI believe that one of the most important elements in the PESTEL model is the legal factor because this dictates if you are legally allowed to do business and if your product meets the standards of health and safety (if your product is food) or the quality standard.
It also affects the mechanisms through which a company stocks their inventory or interacts with the customer.
Employment law is something that you must follow and pay attention to at all times because it dictates how companies’ employees should be treated. Minimum wage laws can limit the various different employment possibilities a company can offer, child labor laws can affect the way tight-knit home businesses in third world countries operate, and dismissal laws can make firing employees (for whatever reason), harder.
It also is tied to the way factories work and the laws around them, like the permissions to operate certain machines, the health regulations in the workplace, and the way you treat employees in the workspace. This is called the employement legislation and adresses issues like discrimination, legal working ages, and safe working conditions. Your business has to have this laws and regulations in check in order to function the best way possible.
References:
Barrington, R. (2021, October 29). What is a PESTEL analysis? Oxford College of Marketing Blog. Retrieved October 29, 2021, from https://blog.oxfordcollegeofmarketing.com/2016/06/30/pestel-analysis/
Bush, T. (2016, July 14). PESTLE Analysis: Legal Factors Affecting Business. PESTLE Analysis. Retrieved October 29, 2021, from https://pestleanalysis.com/legal-factors-affecting-business/#How_Do_Legal_Factors_Affect_Business
ResponderBorrarMichelle Wheelock Elizondo #24
PESTEL Analysis is a strategic framework used to evaluate the external environment of a business by breaking down the opportunities and risks into Political, Economic, Social, Technological, Environmental, and Legal factors.
The PESTLE is a basic footprint for investigative action to be taken. It is applicable to any organization to a greater or to a lesser extent, pending organizational line of business, client needs, demographic regions, competitors, availability of resources, global presence, etc. Due to variation in organizational composition within the global economic arena, one may find that the application of the PESTLE may be differently interpreted from organization to organization, influenced by the latter factors. Hence, it is a tool that highlights or reminds of areas of importance to consider during strategic planning in the organization. There are some limitations of PESTEL: Users can oversimplify the information that is used for making decisions. The process has to be conducted regularly to be effective and often organizations do not make this investment.
In my opinion in PESTLE, Economic is the most important because, Economic factors a have direct impact on a company’s long-term prospects in a market. The economic environment may affect how a company prices their products or influence the supply and demand model. Environmental factors can include: Inflation rate, Disposable income, Unemployment rate, Interest rates, Foreign exchange rates, Economic growth patterns
Often these are the focus of external environment analysis. The economic outlook is of extreme importance for a business, but the importance of the other PESTEL factors should not be overlooked.
http://futureofcio.blogspot.com/2015/10/which-is-most-critical-factor-in.html
It is crucial for companies to know about their macro environment information, such as economic, demographic, technological, natural, social, cultural, legal, and political factors, these are the ones to determine what you do with your company, where can you lead it, where can it go, everything, not knowing these factors is the same as not knowing about your own company and its internal factors, like revenue streams, costs, partnerships, etc. anything you could find on a canvas model.
ResponderBorrarAnyways, it is basic for you to know what is going on around your company and its situation in order to be in control of it, otherwise, you can end up in a bad situation where you have come to the point where you don´t even know what to do or how to control it, and all because you didn´t know about technological advances or maybe about social factors that surround you.
About the PESTEL model, I think the most important points to know, are the social, environmental, and technological ones, because the social one, knowing your public, is the one that will get you the sales, in order to make them , you need people, how do you get people to buy?, knowing what they want, what they like, what is more appealing to them, then about technology and environment, we live in a technological world where it is very hard to find someone who doesn´t carry a phone with them, newspapers are dying, everything is on the internet now, and companies need to get up to date with that, all that, while taking care of the environment, which is a matter of so much importance right now, we are running out of time and we need to stop polluting as much as we do right now, we could find solutions through the same thing that´s causing such levels of pollution, technology, which is another point of the PESTEL model that´s why I find it important, they kind of connected.
Monash University. "Macro Environment" Retrieved from Monash University on October 29th, 2021: https://www.monash.edu/business/marketing/marketing-dictionary/m/macro-environment
Professional Academy. "Marketing theories - PESTEL ANALYSIS" Retrieved from Professional Academy on October 29th, 2021 from: https://www.professionalacademy.com/blogs/marketing-theories-pestel-analysis/
Angel Adrian Gallardo Rodriguez
ResponderBorrarEvery business has to have margins on which it can work, these help the activities carried out as well as the development of all the activities carried out to happen, these margins are delimited by the macroenvironment of the business, if we do not fully know the macroenvironment of our business we are doomed to failure since without work margins we cannot have an idea of what can be done and what cannot be done, it would be like driving blind on a highway. And not only do they affect margins, but in the same way our growth opportunities are also seriously affected.
Personally, I consider that the most important element of the PESTEL model is the legal one, since it is the one that initially tells us what we can do and what we cannot do without any type of flexibility or exception in this aspect, in addition to being the one that has much more serious consequences to our business, being jail our first stop of not taking this element into account, in the same way knowing this element gives us a variety of options of what we can do, knowing this is an essential tool when time to grow as a business
Barrington, R. (2021, 29 October). What is a PESTEL analysis? Oxford College of Marketing Blog. Recuperado 29 de octubre de 2021, de https://blog.oxfordcollegeofmarketing.com/2016/06/30/pestel-analysis/
The PESTEL model is very important for the organizations because it helps to identify the macro environmental factors that can have an important influence in their performances. Next, I will explain the most important parts of the PESTEL model. The political factor is very important because is about how the government can have a big influence in your organization taking in account factors as taxes, policies, law, and others. The economic factors are the ones that include the economic stability and growth; you have to take this in account to preview the growth of the organization. The social factors are the ones that include the data about the population, like their age, career, gender, population growth, etc. This is useful to know who can be part of your organization in the way you want to. The technological factors include all about the last technologies that are used and how they can improve your organization. All these things make technological factors very important very important. Environmental Factors are for me the most important because they are about the health of the earth and all the enviroment data. And for last but not worst the legal factors that include laws that are more isolated and that are important.
ResponderBorrarMIGUEL ESQUIVEL
Dianela Rosado.
ResponderBorrarB) Which element of the PESTEL model do you consider is the most important and why?
From my perspective the economic factor is the key piece since it encompasses more than just "money", the economic factor talks not only about Tax Rate, Exchange Rate, Inflation, Labor, Demand/ Supply, Wages Law and policies, Governmental Activity, Recession, which means that it includes another of the strong elements of PESTEL: politics. Although these elements such as political laws are not strictly related to business, they influence future investments. The economic factor measures the health and stability of any economic region, it is constantly changing, it compares the levels of inflation, unemployment, economic growth and international trade, developing a key strategic plan for the development of the company, without this factor, one would not know about the elements that directly or indirectly affect the income of a company and it would always fall back on the elevation of money, because at the end of the day, money is what sustains not only a company, but also the company, without this factor, we would not know about the elements that directly or indirectly affect the income of a company and would always fall on the elevation of money, because at the end of the day, money is what manages to sustain not only a company but a whole world of business, studies and analysis allow us to have a more open perspective of the areas of opportunity, spaces to negotiate, entries to invest and win, etc..
Contributor, P. (2020, 22 septiembre). The PESTEL Framework Explained: 6 Important Factors. PESTLE Analysis. https://pestleanalysis.com/pestel-framework/
I think the most important PESTEL aspect is Political, political aspect basically means diplomacy, communication, humans must communicate to agree, if we don’t agree in something everything else comes down, if this is common and mostly important at a person level, at a country level gets really important, because it is a huge group of people of the same culture, and politically have a representant who is going to agree with other cultures. Politically diplomacy has always been a key aspect in the management of a country, even authoritarian regimes need diplomacy, because if they don’t have any diplomacy no one will ever make a deal with them or even will try to overthrow the regime, not a great plan, nowadays all countries are dependent of each other, ones more than others, but that is capitalism, even China a “communist country” is so rich because of capitalism, because if you have to spare, you can sell what you have left and make a doble gain, maintaining yourself and even get a gain for your resources, this makes diplomacy a key thing, for example Mexico, if Mexico wants to bother its principal Trading Partner, The USA, Mexico is going to get kicked back, and it won’t be a nice pat, it will be a football kick, because Mexico need the United States and we have to be politically correct with them.
ResponderBorrarMILAGROS RUIZ. (26 de 07 de 2020). MILAGROS RUIZ. Obtenido de https://milagrosruizbarroeta.com/analisis-pestel/
Answer of Renata Lugo Barrera. Missing reference
ResponderBorrarThe macro-environment refers to how the macroeconomic conditions in which a company or sector operates influence its performance. Macroeconomics deals with aggregate production, spending, and the price level in an economy as opposed to individual industries and markets. The amount of the macro environment's influence depends on how much of a company's business is dependent on the health of the overall economy. Cyclical industries are heavily influenced by the macro environment, while basic staple industries are less influenced. Industries that are highly dependent on credit to finance purchases and business investments are strongly influenced by changes in interest rates and global financial markets. The macro-environment can also directly affect consumers’ ability and willingness to spend. Luxury goods industries and big-ticket consumer goods can be highly impacted by fluctuations in consumer spending. Consumers’ reactions to the broad macro-environment are closely monitored by businesses and economists as a gauge for an economy’s health. Business analysts often conduct a PEST (political, economic, socio-cultural, and technological) analysis to identify macro-economic factors that currently affect or in the future may affect business. I think the most important element is the Social factors include trends in demographics such as population size, age, and ethnic mix, as well as cultural trends such as attitudes toward obesity and consumer activism.
Junior Arellano
ResponderBorrarA) Not knowing this aspect, damages the whole structure of your business, before starting a business we must know, the investment we have to make, have made a market analysis, the areas in which it can be distributed in case of being a factory, or if they are local in which areas sell better, but well, this is supposed to come in the market analysis. Let's see this as forces, forces that we have to control at all times for a successful business, however difficult they may be to control. And these are economic, demographic, technological, natural, social, cultural, legal and political; these aspects influence all decision making in a company and have a great impact on its performance, since forgetting one aspect can create chaos in a company.
B) A PESTEL analysis is an acronym for a tool used to identify the macro (external) forces facing an organisation. The letters stand for Politics, Economics, Society, Technology, Environment and Law.
I consider the economic factors to be the most important, as they take into account the different aspects of the economy and how the outlook for each area can affect your business. These economic indicators are usually measured and reported by Central Banks and other Government Agencies.
An economic factor is a factor that can affect and influence an individual's financial situation. They include education, employment status and income.
The study of economics enables them to understand the financial sector, credit levels, economic policies and general economic activity for proper business decision making. Knowledge of economic theory helps to make running a business more efficient. In this part, we are not just talking about how the economy influences business, but how business influences the economy. No matter whether they are large, medium or small businesses, they all contribute to coordinating, directing and controlling the production process, and they are also an agent that constitutes one of the fundamental pillars of economic activity, creating employment, generating wealth and driving major innovations.
https://pestleanalysis.com/pestel-framework/