External environment , business strategy Coursework

External environment , business strategy - Coursework Example Under the competitive environment, also referred to as the task or industry environment, the strategist takes into consideration the decisions, actions and moves initiated by rival firms in the same industry. The PESTEL analysis and five forces model would delineate the opportunities that an organization can tap. At the same time, various threats that the organization should be vary of would also be uncovered with the help of this analysis. These threats and opportunities are kept in mind and correlated with internal strengths and weaknesses while deciding various strategic issues including which businesses should the company invest money in. The objectives are also set keeping in mind the opportunities available to the organization. Under the political factors, the strategist has to take into consideration the political stability, ideology of the ruling government as well as its attitude towards various businesses. The economic factors include interest rates, income levels, unemployment rates, and rate of inflation prevailing in the country. In general, recessionary conditions can have an adverse impact on companies. Rising affluence of people may prove to be a boon to companies especially to those operating in the entertainment and leisure sector. The social factors include the opinions, beliefs, values and attitudes of the people. Number of women in the workforce, concern for health and fitness are also socio-cultural aspects, the increase in which can provide a boost to certain industries. Technological aspects too impact businesses. A company operating in the cell phone or computer manufacturing industry may confront a short product life cycle. In order to sustain in such an environment such company will have to constantly invest in research and development and manufacture state-of-the-art technologically advanced products. The issue of global warming has necessitated that all companies adopt ‘green’ measures. This may