Assignment on Macro and Micro Environmental Influence on Automobile Sector in UK
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Added on 2020-06-05
Assignment on Macro and Micro Environmental Influence on Automobile Sector in UK
Added on 2020-06-05
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Industry Analysis andPossible Adaptations
TABLE OF CONTENTSINTRODUCTION:.........................................................................................................................1TASK 1............................................................................................................................................1A) PESTEL and porter's five force model analysis of BMW.....................................................1B) Value chain model of BMW .................................................................................................5C) Porter's 5 force in developing external environment of BMW .............................................8CONCLUSION:...............................................................................................................................9REFERENCES:.............................................................................................................................10
INTRODUCTION:Business environment is the key to success for any organisation. By understanding itssurrounding environment business can survive for long term. It is very essential for everybusiness to have a depth knowledge of environment as it helps in growth of business. Thevarious factors are persons, place, things and natural resources. All these factors and forces arecombined together and is known as called business environment. It consists of micro and macrofactors in which business operations are performed. Macro forces are external environmentwhich can not be controlled and affects the performance of business while micro consists ofinternal environment that exist within the business. This assignment will throw light on themacro and micro environmental influences and how they are affecting auto mobile sector in UK.In addition to this how internal business environment is analysed by using value chain model isdiscussed. At the last how five force model helps in understanding the external environment ofbusiness in auto mobile sector in UK has been described.For undertaking this present organisation selected is Bayerische Motoren Werke (BMW).The cited firm belongs to auto-mobile sector and operates globally. The existence of thecompany on such a great level requires understanding its business environment. Thus, this reportwill help in developing a relevant one for the cited establishment.TASK 1A) PESTEL and porter's five force model analysis of BMWIn the recent times it is very important to analyse the external factors that affects the businessoperations. Every business is somehow affected by various factors. It is because these factorsinfluence business decisions that is taken. PESTEL is a concept that defines the marketingprinciples. It is a mnemonic which denotes P for political, E for economical, S for social, T fortechnological, E for environmental and L for legal. The business like BMW will analyse thesefactors while taking decisions (Welford,, 2013) The explanation of these factors are given below:
Political factors- It includes various decisions like changes in fiscal policy, import – exportduties and tariffs, etc. that are taken within the country for trade. These decisions are taken bygovernment and it influences business strategies and decisions to a great extent. BMW operatesglobally so various political pressure of different government affects their business decisions andoverall strategies. They have to develop strategies according to different political environment.This sector contributes a huge part in GDP oh the country as many other industries are alsorelated to it (Hamilto. and Webster, 2015) Further, Asian and European market are different inmany ways. So BMW growth is dependent on both these markets.Economic factors- It includes elements like GDP, inflation rate, and national income of thenation. Through this the foreign exchange rate and economic growth and development of countryis identified. They affect long term growth strategies of company it is because industries likesteel , glass are related to it that provides additional benefits to them. UK economy is expandinga very fast rate allowing opportunities to big companies to start their business. Further, UK exitfrom EU has now allowed them to take independent decisions regarding the economic policies.The other side of this factor is uncertainty in the economic conditions which arises due to the fallin currency rates because of their exit from EU. BMW usually focuses on producing car as theyget most of their sales by selling cars. In this way they have developed a market position in UK.Social factors- It is formed by the society culture and needs of people. It shows the livingstandard and lifestyle of people in the society (Welford,, 2013) Culture of UK people is based onIllustration 1: PESTEL
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