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PESTEL Analysis of Aviva Plc : Report

   

Added on  2020-01-21

15 Pages5483 Words1402 Views
Contemporary Developments inBusiness and Management

TABLE OF CONTENTSINTRODUCTION...........................................................................................................................1TASK 1: PESTEL ANALYSIS........................................................................................................1TASK 2: GLOBLIZATION AND BARRIER TO GLOBLIZATION...........................................41. Relevance of globalization to Aviva PLC and its influence on policies and decision making.....................................................................................................................................................42. Critical evaluation of the effectiveness of the organization’s response..................................73. Demonstrating some areas for improvement in the response of the organization...................9CONCLUSION..............................................................................................................................10REFERENCES..............................................................................................................................11APPENDIX....................................................................................................................................13

INTRODUCTIONCompetition is raising day by day which is creating problem in survival of the businessso, every organization needs to focus on using different techniques for getting success. There arenumber of contemporary development in business and management that help in running businessoperations and improving strategic performance of the organization (Muhammad and et.al,2011). The current research project is based on the recent development of the different industryand management. Regarding this, it has been chosen Aviva PLC which is one of the leadingorganization of insurance industry of UK. It offers insurance services to different national andinternational customers of the host and foreign countries. Analysing the internal and externalenvironment of the organization is one of the major aim of this report. Regarding this, it will useappropriate tool for analysing the macro environment of Aviva and its impact of differentexternal factors on overall performance and business activities of the organization. Along withthis, study will also focus on globalization and its influence on policies and decision makingprocess of company. Further, study will determine the effectiveness of the organizationalresponse towards the different barriers of globalization. Afterwards, scope of improvement in theresponse of Aviva is also describing in the following paragraphs of the report. TASK 1: PESTEL ANALYSISAs per the present scenario, Aviva PLC has taken into consideration where theorganization works as an insurer and pension provider in London UK and other parts of theworld. The operations of the firm can be influenced by macro and micro factors. In order to makeanalysis of the same PESTLE analysis has considered. It will assist the cited firm to identifies theimpact of macro factors on the growth of firm. It aids the company to analyse the areas throughwhich the earning, income or profitability may get affected. Certain factors are stated below.Political factors: Political factors consist of tax policies, laws and trade restrictions. This factorcan be responsible to affect business operations of the cited firm. It includes sub factors liketerrorism, tax treatment, regulatory reform and geopolitical risk. Terrorism can affect theglobalization and standardization of the Aviva PLC. If this factor is avail in the economy, atcorporate level firms will not be interested in dealing with the cited company. It can affect theclient and costumer base of the firm Srdjevic, Bajcetic and Srdjevic, 2012). 1| P a g e

In addition to it, the impact of terrorism is affecting the multiple product lines such asworkers compensation, life and benefits. On another side, the geopolitical instability can affectthe operations of the firm. In this, the scarcity of resources is identified which results intoinstability of the economy. There is some positive impact of political factor on the cited firm isthat, the government has mad third party insurance compulsory due to which the people of UKhas to get done their insurance. Increase in motor car insurance leads to hike in the income andprofitability of the cited company. On the other hand, increase in taxation can have a negativeimpact on the firm as the investment done by the consumers will be low. It will be necessarilypaid the income tax due to which they wont be able to invest in insurance. As a result, thefinancial stability of the company will surely get affected (Paterson, Brubaker and Wendel,1993).Social factors: Insurance business is complex and competitive as compare to other industries.Financial responsibilities has been performed by the cited firm. In today's era it is identified thatthe standard of living of customers has increased. The policies framed by the UK governmenttowards insurance is stiff. At the time of purchasing new vehicle it is necessary to makeinsurance of the vehicle. It aids Aviva PLC to increase large number of customer base. With thechange in time, people are getting more conscious with health in order to attain this factor lifeinsurance plans are adopted by the UK citizens. It has provided assistance to the management ofcited firm to increase its operations and profit. Earlier, customer required to take initiatives for the insurance but with the changing timecompany itself offer opportunities to the consumers. It has also seen that the mentioned firm hasdiversified into various sector like pension, general insurance and life insurances. It has given anopportunity to the company to grow and expand at global level. With the changing time theconcept of nuclear family has introduced in the market where all the members of the family canget their insurance done. The overall impact of the social factor is positive as it has offeredassurance to the firm to get expand in different field of finance.Technological factors: The changing time has improved the technology that leads to effectiverunning of operations of Aviva PLC. The emergence of internet has offered opportunities to thefirm where they can communicate with the customers easily. With the help of blogs and pagesover social media, the cited organization can interact with the customers at frequent basis. Withthe change in policies and procedure of the company can be updated with the use of website of2| P a g e

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