Business Environment and PESTLE Analysis Report for Pearson Plc

This report provides a comprehensive analysis of Pearson Plc's business environment. It begins with an overview of the company's organizational structure, highlighting its hierarchical nature and the roles of key directors. The report then delves into the importance of PESTLE analysis for Pearson, outlining how it helps identify external factors influencing the company's operations. The analysis further examines the macro factors impacting Pearson, categorizing them into political, economic, social, technological, legal, and environmental factors, and detailing their specific influences on the company's strategic and operational aspects. A PESTLE analysis of Pearson is also provided, detailing how the company operates in a competitive environment. The report concludes by synthesizing the findings and emphasizing the importance of understanding the business environment for strategic decision-making.

Business Environment

Table of Contents
TASK 1............................................................................................................................................3
Organisational structure of Pearson............................................................................................3
TASK 2............................................................................................................................................5
TASK 3............................................................................................................................................6
(A) Listing macro factors that have influence on the environment of Pearson Plc ...................6
Pestel analysis of Pearson...........................................................................................................8
CONCLUSION..............................................................................................................................10
REFERENCES..............................................................................................................................11

INTRODUCTION
Business environment refers to both internal and external factors that have influence on
business operations. These factors include employees, customer needs, clients, owner, suppliers,
social trends and activities of government that are keep on changing. Thus, it is an accountability
of manager to develop competent strategic and policy framework by evaluating business
environmental aspects. business in finding opportunities that contribute in organizational goals
and objectives. of this report, Pearson plc has been selected, an is education company with
24000 employees which are across 70 countries . It is the world largest book publisher in the
world. It project will discuss about the organizational structure within which Pearson Plc
operates. e that is used by the company to understanding about PESTLE analysis and it
applicability with regards to concerned organization. Its number of directors an their
appointment.
TASK 1
Organisational structure of Pearson
This are accompanying to the direction on certain activities which are related in order to
achieve the goals of the organization(Dvoroková and Kulhánek, 2017) . The activities used in
this are related to the rules, roles and responsibility and how information is transferred between
the levels of the company
Pearson operates within hierarchical structure that means there is chain of command
between the top level of the organization till the bottom. The top level management takes all the
decisions which are related to the rules, policies and related business aspects. According to the
concerned structure every individual of the firm is obliged to follow the same. In this the
different level have various authority with the command change but the decision taking powers is
done by only the top management and the other one can give some suggestion which can be used
for the growth of the organization (,Garcia-Blandon and et.al, 2017).
It is important because the employee cannot connect with the top level so easily because
there are different departments and divisions in the company is they have any issue they can
coordinate with their head which will help them in solving all the problem without consuming
time. All the information related to the business are given to the head of departments and then
they tell it to the other members of the company. Management is responsible for making all the

decisions that allow the company to achieve the goals of the company. From this the individual
come to know what are their position in the organizations and how they can perform their task in
simplest form. As they are divided in different divisions it is easier for them to assign small asks
to each employee of that division ((Ofosu-Boateng, and et.al, 2020).
Pearson uses this line because line between the authority and reporting in the business,
helps in understanding the roles and responsibility of the employee also motivating them towards
the work and providing path for career. By using this hierarchical structure there will be
improvement in the loyalty (Pearson. 2021).
There are total of 10 directors in company who take decision about company’s affairs
and operations. Out of which one comprises for senior independent non-executive director, five
independent non-executive director, one chief executive office, one financial officer and chief
operation and technology officer (Garner and Martínez Rodríguez, 2018)Sidney Taurel is the
chairperson and Andy Bird acts as chief executive officer of Pearson Plc.
When were they elected and appointed?
 Andy bird was appointed to the board as the chief executive officer & non-executive
director on 1 may, 2020.
 Sally Johnson is appointed as the chief financial officer & executive director in 2020.
 Sidney taurel the chairman of the Pearson from 2016.
 Albert Hitchcock who is the operation & technology officer since 2014
 Vivienne cox the senior independent non-executive director from 2012.
 Linda Koch lorimer (2013), Dame Elizabeth Corley (2014), Tim score (2015), Lin coin
Wallen, Dr (2016), and Graeme pitkethly (2019) all are the independent non-executive
director.
TASK 2
Evaluating the importance Pestle analysis for Pearson plc

PESTLE analysis may be defined as a method which helps in identifying external factors
that will affect the organizational operations. This analysis mainly furnishes information about
political, economic, sociological, technological, environmental and legal factors which influence
company’s policies will increase
Importance of PESTLE analysis in the context of Pearson Plc is as follows:
It helps in knowing what are the steps taken in starting the business and conducting it.
(The Importance of PESTEL Analysis for Environmental Scanning Process. 2021.) They give
information about what are the wants and needs of the customers is company are fulfilling their
all the needs. plays an important role in growth of the business. It is needed by every company
whether it is starting up or panning different strategies. With the help of this the owner of the
business can find out what the changes that the company have to make using different factors. It
also provides strategic planning related to this analysis from which the owner can expand their
business (Gentile-Lüdecke, de Oliveira and Paul, 2020) . They also create the opportunities and
threads for the organizations.
Analysis include all the legal and environmental factors which are related to changing the
policies and rates. This are the external influences that the organisation have to work on this facts
rather than assumptions. It will have impact on the marketing and relationships that company
have worked hard to achieve it. This analysis helps business to understand the wider business
environment. The firm can assess directly to the market that are related to its competitors and
understanding the market growth, positions of the company in different field and what the
directions that are used by the organizations to operate the business using different strategies.
They also provide different structure to launch the business operation in new markets and
countries. By using this methods, the firm can make the plans for the threats (islam, 2017)
TASK 3
(A) Listing macro factors that have influence on the environment of Pearson Plc
PESTEL analysis is used to study the macro-environmental factors associated with the
business which impose impact on business operations. The opportunities are identified to take

the first mover advantage in the business. Also, the threats are discovered to strategically plan for
meeting it.
The external environment is bifurcated into political, economic, social, technological,
environmental and legal factors. The influence that these factors have on strategic and
operational aspects of Pearson Plc are enumerated below: -
Political factors: - The political factor of the economy shows the degree of interference of
government and the political parties in the processing of the company (Perera, 2017). The
policies, laws, regulations that are formed by the government related to tax, trade, environment,
labour laws, foreign trade, etc. If there is political instability in the country, then it can severely
affect the business. Subsidies are also provided to the businesses that the government wishes to
promote like the health, infrastructure, education etc.
Economic factors: - These factors are the determinants of the current scenario of the economy
and poses long term impact on the status of the company. It includes inflation, foreign exchange,
growth, interest, unemployment rates prevail in the concerned country (Rastogi and Trivedi,
2016). These rates shall affect the disposable income of an individual which shall further cause
minimization of the purchasing power of the company's potential customers. Hence, accordingly
the demand and supply forces shall be changing in the economy.
Social factors: - The social factors in any organization refer to the characteristics borne by the
population in the economy. It can be classified in the form of demographic components, culture,
value systems, norms etc. The profitability of Pearson Plc depends on the lifestyle, market
trends, health conscious attitude of customers etc. The beliefs and attitudes of the people affect
products and services that are offered by the company (Islam and Mamun, 2017).
Technological factors: - Currently in the era of technology the companies which adopt new
technology are successful in terms of cost, time and efforts of the human resource. The
innovation in the technology changes the operations of the company whereby new methods
which are faster and more efficient are developed in the company generating economies of scale
(Ofosu-Boateng and Jiping, 2020). The automation in some manual processes shall help in
reducing the errors in the company and minimizing the wastages of resources. The company
studies technological environment to take first move if new technology could be introduced.
Further, currently in order to promote products or services business are emphasizing on placing
advertisements through both online and offline media sources (Mela, 2021) .

Legal factors: - They consider more specific laws that are developed in order to check the
customer protection, safety and security, health issues, copyright etc. These laws are to be
mandatorily followed and if not done so penalty shall be attached. Along with this, for
developing effectual brand image at workplace Pearson Plc is also required to comply with
employment laws and legislation.
Environmental factors: - The environmental factors are also to be considered by the business
and accordingly undertake the corporate social responsibility. It can be in respect of pollution,
sustainable development, non-biodegradable resources, clean and green environment and the
carbon footprint targets (Dalirazar and Sabzi, 2020). Thus, while developing strategies
management team of Pearson Plc should focus on eco-friendly or sustainable operations. Apart
from this the change in the weather and the climatic conditions can also be one reason that can
impact the profitability of the business.
Pestel analysis of Pearson
The analysis gives details about the operating challenges of the Pearson that are
related to the competitive forces (Merendino and Sarens, 2020) .
Political factors: This factor play an important role in the Pearson as it can affect the
long-term profitability in not only the company but also in few country and markets (Pearson
Plc PESTEL Analysis. 2021.). Company sells their books in several countries and also faces the
problems which are related to the political environment and risks. Before entering into the new
markets the firm have to see that all the details related to the product labelling and other are
properly return on that without any errors. It is important for the Pearson to see the the changes
that are made by the government which will result in alter towards the development of the
industry (Moşteanu, 2020) .
(Islam and Mamun, 2017). . . . Moreover, if the government of country are well developed then
they can make environment more comfortable for the Pearson who is the international business
organization. Along this the things that are affected by political factors are legal framework,
trade regulations, different laws, employee benefits and interference of government.
Economic factors: All the factors which are related to the growth rate, inflation &
economic indicators that are publishing books, consumer spending etc. to outlook not only the

sectors but also of the organization are discussed under this factor. It is important for the
Pearson to understand the factors which are relevant to the foreign exchange rates, labour
conditions and saving rates as they regulate the overall environment of country. If the company
have full knowledge about the economic factors then it can help them to estimate the growth
tragedy of industry (Neis, Pereira, and Maccari, 2017) .
Growing economics provides Pearson the wide range of opportunity growth that are useful for
them. They consider a thought that if the GDP is high then it will result in more consumer
spending on the products that are offered by the company. Higher interest rate will inspire the
company in spending, increasing opportunities and to make profits in international trade
markets. The company can also raise its capital at fair price which can relate to the health and
efficiency of financial markets. Various factors that have impact related to the economic are
business cycle, government intervention, exchange rates and education level in the economy.
Social factors: The way of doing work and culture have direct impact on the Pearson. As
the Attitude of the people and beliefs are kept on changing and it is important for them to
understand the customers trends, power structure and spending patterns in the markets and how
to design the books as per the requirements (Setiawan and Gestanti, 2018) . Changing in the
demographic trends make Pearson to choose segments which are related to the growth and
development. While entering into the new markets the Pearson have to change its business
market practices. Developing local teams and partnership will develop the attitude and norms
strategies according to unique cultural context of Pearson. Use of mobile phones and social sites
will help in developing communication and marketing strategies. They should invest their time
on understanding what are the needs and demands of the consumers and interest over the
traditional product offerings. It should also have focus on online shopping behaviour that is
difference related to the generations, Factors that have direct impact on Pearson are attitudes,
interest, educational level, cultural and power structure of the society.
Technological factors: They consider towards the changes that have direct impact
towards the goal of the company. This is the fourth stage of analysis which are related to
understanding the factors that are discussed at the time of making strategic decision of the
company. If all the information are mentioned in details then it will result in capturing the trends
for the business that are increasing profitability and fasting innovation process. The Pearson
should keep eye on the changing technological trends that will make them to stay one step ahead

from its competitors. Understanding new technologies chain and cost Pearson must also have
knowledge about what are the investments made by its competitors on different levels. By using
fresh technologies have made them to develop their goods on quick basis and also have resulted
in faster supply rate. This changes are related to the development, cost structure and
technological diffusion (Perera, 2017) .
Environmental factors: Some of the company have different norms and structure which
can affect the profits of the Pearson. In the same field or within the country they have various
laws which are not similar to each others. Changing climate conditions have made an important
part for the company to focus on the environmental factors. Before entering to new markets
Pearson must understand the difference that are related to avoid several circumstances. The
government of the countries that have the strict norms that are related to the recycling and waste
management specially to the company that are situated inside the areas where large number of
people are living.
Legal factors: This are the important factor that Pearson know when the company is
entering into the new markets. As the Pearson is situated in the country which have strict norms
regarding the health and safety of the employees. Some of the legal factors that Pearson have to
face at the time of joining new markets that are copyrights, data protection and consumer
protection (Rastogi and Trivedi, 2016) .
CONCLUSION
In the above report it has been concluded that Pearson is public limited company that
deals in providing education and publishing books. Project have reflected the history of the
Pearson by describing the organisational structure, number of directors that company have and
when they were elected and appointed. Further to that pestel analysis of the business
organization is also done similar to that the importance of pestel is clearly mentioned. Although
the factors that affect the environment of the Pearson are given in detail. Further to that pestel of
the company is also done using proper method and description
REFERENCES
Books and Journals
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Moşteanu, N.R., 2020. Challenges for Organizational Structure and design as a result of
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Ofosu-Boateng, C. N. R. L. and Jiping, Z., 2020. A Pestle Analysis of Maritime Piracy and
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Online source
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https://www.case48.com/pestel-analysis/11066-Pearson-Plc >
Pearson. 2021. [online]. Available through: < https://www.companieshistory.com/pearson/>
The Importance of PESTEL Analysis for Environmental Scanning Process. 2021. [online].
Available through: <https://www.igi-global.com/chapter/the-importance-of-pestel-
analysis-for-environmental-scanning-process/241707>