Impact of External Factors on ASDA: PESTEL Analysis, Leadership Styles, CSR, Brexit and Covid-19 Effects

SSHE Projects
Task 1

Contents
INTRODUCTION...........................................................................................................................1
MAIN Body.....................................................................................................................................1
Impact of external environmental factors on business organisation by using PESTEL analysis
................................................................................................................................................1
Several Leadership Styles and recommendation....................................................................2
Corporate social responsibility on business organisation.......................................................4
Effect of Brexit and Covid-19 pandemic on business organisation.......................................7
CONCLUSION................................................................................................................................8
References:.......................................................................................................................................9

INTRODUCTION
The business organisation employs number of strategies for gaining competitive advantage
over the competitors. The ability of the leadership influences the business strategy and response.
Business strategy is long term approach of implementing firm’s business plan for attaining
business objectives. The effective leadership in the business benefits in making effective
decision along with direction is provided to employees (Arnold, and Bowie, 2019). For the
present report ASDA is consider which is British supermarket chain that is headquartered in
Leeds, England. The company was founded in 1949 dealing in the products of Grocery, general
merchandise, financial services etc. The report covers the impact of externa environment factors
by using PESTEL analysis along with suitable leadership style is recommended that will help in
attaining the business objectives. In addition, corporate social responsibility is important for
organisation which consider the environmental and social impact of business decisions. Further,
the effect of Brexit & Covid-19 pandemic is considered on the business organisation.
MAIN Body
Impact of external environmental factors on business organisation by using PESTEL analysis
PESTLE Analysis of ASDA
Retail industry play a crucial role on global scale when determining nation's GDP during
having an immense potential for the future growth. PESTLE analysis is used in different
scenarios and also guide the organisations in strategic decision making. Therefore, in context of
the ASDA that is a retail organisation, impact of the PESTLE analysis is discussed below:
 Political factors- This element impact the organisations in term of the political unrest,
unstable government, education policies, taxation policies and so on (Al-Dawood, 2020).
Therefore, it has been identified that taxation polices formulated by the government has
major impact on the ASDA. This is because, respective firm has to pay a high tax rates. It
has a direct impact on the organisational profitability and also reduce their ability to
maintain the low pricing strategy.
 Economic factors- Every nation have different economic policies that influence taste
regimes, ROI and inflations. In relation to ASDA, respective firm is facing issue of high
interest rates, recession and demand for the online shopping. It has been identified that
recession lead to drop in organisational sales, that cause a decline in ASDA's profit.
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Along with this inflation impact the company's product price. It lowers its business as
customers may not have a strong purchasing power for expensive service or products.
 Social factors- It has been identified that society is changing continually. Fashions and
tastes are great examples of this change. Organisations get impacted by the element in
term of the trends, tastes and demographic components. In context of ASDA, changing
lifestyle of the customer’s ah greatly influence the customer preference due to which,
respective organisation have keep updated itself.
 Technological factors- Technology and digitalisation has become key components in
business operation (Bentham, 2018). Organisations uses it to with the motive to increase
their internal business operations, communication, advertising and e-marketing. Through
technology, companies can devise latest business model which help them in meeting
needs of the technology user. Therefore, in relation to the ASDA, respective organisation
has decided to operating its clothing business via online platforms. Hence, in order to
remain relevant and make the business operations more effective and efficient, ASDA is
using innovative technology properly.
 Legal factors- There are various types of the law and regulations which dictate terms of
operating business such as regulations related to the employment and other tax policies.
In case of ASDA, it has to obey and follow every law doing business formulated by the
government otherwise it may lead to a hefty fine which in turn reduce organisational
revenue. It may also damage reputation of the company within marketplace.
 Environmental factors- Nowadays society has become more concerned towards the
environmental sustainability practices (Gunasekare, 2018). Therefore, in order to gain
competitive edge, organisations are becoming responsible to the nature or environment
within they operate. In context of the ASDA, it has formulated numerous strategies
through which it ensures the eco-friendly practices. For instance, respective organisation
has adopted use of the recyclable products or material for packaging.
Several Leadership Styles and recommendation
Leadership style is a techniques of leaders to motivate people, implementing plans, and
providing directions. Leaders focuses on setting goals, monitoring efforts, rewarding employees,
and correct the employees if require. A leader should have tactical as well as technical
knowledge. With the engagement to their employees leaders use leadership styles. It is
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