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Advantages and Disadvantages of PESTEL

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Added on  2020-01-28

Advantages and Disadvantages of PESTEL

   Added on 2020-01-28

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Business Strategy
Advantages and Disadvantages of PESTEL_1
TABLE OF CONTENTSINTRODUCTION...........................................................................................................................1MACRO AND COMPETITIVE ANALYSIS OF CUADRILLA..................................................1STRATEGIC OPTIONS AVAILABLE FOR CUADRILLA.........................................................3STRATEGIC IMPLEMENTATION PROCESS............................................................................4CONCLUSION AND RECOMMENDATIONS............................................................................5REFERENCES................................................................................................................................7
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INTRODUCTIONIn such a competitive era, it is essential for each and every business enterprise to developeffectual strategy so that the best results can be attained. Here, Fracking industry has beenundertaken which involves the procedure of creating fractures in rocks or deep into the earthwith the help of injecting fluid into cracks so that they can open their pores. Through suchprocess, large number of oil and gas will flow out of the earth surface (Cahoy, 2013). Frackingprocess has been adopted by various zoology departments in order to gain more oil and gas,achieve a high state of economic viability, reach a high level of extraction etc. Fracking is alsoknown as hydraulic fracturing that helps in designing a technique in order to recover gas and oilfrom shale rock so that large number of oil and gas can be recovered from wells. MACRO AND COMPETITIVE ANALYSIS OF CUADRILLAFracking is a process of drilling down into the earth by involving a high pressure of watermixture directed into the earth surface where extraction needs to be done on a given surface ofland. Water, sand and chemicals are injected into the rock with a high pressure that allows gas toflow out and helps in obtaining huge amount of oil and gas. Drilling companies like Cuadrillacan drill horizontally with the layer of rock and thus, create a new pathway in order to releasegas or can be used to extend existing channels (Drnevich and Croson, 2013). Following is themacro and competitive environmental analysis of Cuadrilla-PESTEL analysis Political- It involves different policies formulated by the UK government such astaxation policy, government policy, labour law etc. It has been assessed that more than100 licenses have been provided by the UK government to different firms in order toallow them to carry out fracking process and extract oil and gas exploration activities incertain areas of land. But, government intervenes in between and thus it states that firm isrequired to obtain planning permission from the relevant local council before beginningfracking process (Davis and Hoffer, 2012). Main disadvantage for Cuadrilla is that it isessential for the firm to take permission from government so that they can extract oil andgas from earth as they are not allowed for extracting natural resources without takingprior permission from the government. 1
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Economic- Here, it assesses that economic factors have significant impact upon how theorganization carries out the business does and how much they attain profits. It involvesdifferent factors such as interest rate, exchange rate, inflation rate etc. However, throughcarrying out Fracking process it helps in lowering down the gas prices. However, suchimpact helps in creating larger market share and creates jobs for individuals (Rinfret,Cook and Pautz, 2014). Advantage of economic factor is that it helps in enhancing themarket share and also increases job opportunities for individuals. While, the disadvantageis that due to prevailing recession in country, business faces economic issues in order toprovide job opportunities as well as selling oil at higher prices. Social- It involves shared belief and attitudes of population. However, labour of thecountry has called for a hold on fracking till the time that need be ensured regarding thesafety of the process. They state that it should not harm the environment badly. Throughstopping the fracking process, main advantage is that environmental safety can beattained. Also, it is essential for companies to provide safety and security to workers. Technological- Here, changes in the technological factors impact the market andcompany's products. However, Cuadrilla is required to undertake innovative machinesfor drilling into the earth otherwise extraction cannot be done effectively. It helps ingetting more oil and gas (Willow, 2015). Main disadvantage of this factor is that firmdoes not have innovative machines therefore, it is essential for it to own effectivemachinery so that drilling can be carried out effectively and efficiently. Environmental- Such factors are required to be viewed in order to protect theenvironment from extraction. However, fracking process uses huge amount of water thatneeds to be transported to the particular place where fracking is required to be done andthus it causes significant environmental cost. Furthermore, such process also causes smallearth tremors. One of the disadvantages of this factor is that fracking process uses hugeamount of water that needs to be transported to a particular place where fracking isrequired to be done and thus, it causes significant environmental cost.Legal- It is essential for the organization to undertake different legal factors such ashealth and safety, equal opportunities and consumer rights. Thus, it is essential forCuadrilla to carry out effective employment laws in order to provide the bestopportunities to individuals and also render them proper health and safety regulations so2
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