Impact of Environmental Factors on Business Culture

This presentation explores the impact of internal and external environmental factors on business culture and provides insights on managing them effectively. It covers PESTLE and SWOT analysis, highlighting the significance of political, economic, social, technological, environmental, and legal factors. The presentation also discusses the strengths, weaknesses, opportunities, and threats faced by organizations like Pepsi. It concludes with recommendations on creating effective strategies and policies to mitigate the negative impacts of environmental factors.

Portfolio

Table of content
• Introduction
• PESTLE analysis
• SWOT analysis
• Conclusion
• References

INTRODUCTION
Each and every organisation has it own business culture. This business
culture can be affected through business environmental aspects. Thus,
for them it is required to analyse impact of internal and external
environmental factors to manage its impacts effectively.

PESTEL analysis
Political factors – These are the external environmental factors that
affect business procedures and practices easily. Pepsi always
implement legislation and ethical terms in their business practices
that assist them in developed their market structure in numerous
countries.

Contd..
Economical factors - Economic factors include economic growth,
interest rates, exchange rates, inflation, disposable income of
consumers as well as other factors that has major impact on the
economy development practices of country. UK having growth rate as
1.8% which means organisations as Pepsi and so on have opportunity
to getting effective returns on their investments in UK. Disposable
income in UK is is £27,200 in 2017, an increase of 1.8% from past few
years that means customer's can spend a amount of their income on
different products (United Kingdom Households Disposable Income.
2018).

Contd..
Social factors – Pepsi is a most popular brand that cater quality
services to their customers that assist them to managing influence
of external social factor in business practices.
Technological factors – Technological factors has a major impact on
different business organisation. Pepsi always cope up with different
advance technologies in manufacturing, delivering and promotional
practices.

Contd..
Environmental factors – Environmental factor has major impact on
business practices. Therefore, Pepsi always pay their maximum
attention toward net zero environmental strategies that assist in
reducing issues pollution that be ground through waste cane and
bottle.
Legal factors - Pepsi has faced numerous legal issues from past
years over their product quality.

SWOT analysis
Strength:
Brand equity: It is the most well known brand in the world in the
food and beverage sectors. This is consider as the brand of youth
and it is highly recognised and reputed.
Strong leadership: It has manage to stay at number two position in
the food and beverage sector only after the Nestle .
Tie-Ups – PepsiCo has tie-up with music gig and sports events which
helps them to remain in lime light.

Contd..
Weaknesses:-
Competitors: In the soft drink category it has the strong neck to neck
competition with the Coca cola.
Product perceived as unhealthy: Most of the soft drinks are
perceived as unhealthy.
Failed Product: product fail like ' Crystal Pepsi' effect the brand
image which create or give competitors chance to grow.
Commodity craving – Dependent on beverages and food which can
have adverse impact in future.

Contd..
Opportunities:-
CSR: The Pepsi can do more CSR activities to overcome their
negative remarks that hurt the brand image and goodwill.
R & D: The R& D department of Pepsi should come up with the new
and attractive ideas like diet Pepsi which prove to be a game
changer.
Focus: Focus should be on ingredients which do not have harmful
impact on consumers.

Contd..
Threats:-
Competitors: The main competitors of Pepsi are Coca-Cola, Kraft
food, Nestle etc.
Health Factors: The unhealthy factor with this product affect the
market which decrease the sales.
Changes in customer's demand: Customers are looking for
products which are healthy. Pepsi may lose its customers as sale of
cold drinks is degrading.

CONCLUSION
As per the above analysis it has been analysed that for an organisation
it is required to create effective strategies and policies that assist in
reducing negative impacts of external as well as internal environmental
factors.

REFERENCES
Dockalikova, I. and Klozikova, J., 2014, November. MCDM Methods
in Practice: Determining the Significance of PESTEL Analysis
Criteria. In European Conference on Management, Leadership &
Governance (p. 418). Academic Conferences International
Limited.
Yuan, H., 2013. A SWOT analysis of successful construction waste
management. Journal of Cleaner Production. 39. pp.1-8.

Contd..
Online
United Kingdom Households Disposable Income. 2018. [Online].
Available
through:<https://tradingeconomics.com/united-kingdom/disposable-
personal-income>.

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