Lego's PESTLE Analysis: External Factors Impacting Business Decisions

This report presents a PESTLE analysis of Lego, examining the political, economic, social, technological, legal, and environmental factors influencing the company's strategic decisions. It emphasizes the importance of Corporate Social Responsibility (CSR) practices for Lego, highlighting the advantages and disadvantages of responding to children's changing needs. The analysis covers the impact of political stability, economic improvements, changing customer lifestyles, technological advancements, legal regulations, and environmental concerns on Lego's operations and brand reputation. The report concludes that effective market analysis is crucial for mitigating risks and maintaining the company's brand value, underscoring the need for Lego to adapt to external factors and uphold CSR principles for long-term success.

PESTEL ANALYSIS FOR
LEGO

TABLE OF CONTENT
INTRODUCTION...........................................................................................................................3
QUESTION 1..................................................................................................................................3
Importance for business to practice CSR.....................................................................................3
QUESTION 2..................................................................................................................................3
Advantages and disadvantages of Lego responding to call of change by children.....................3
QUESTION 3..................................................................................................................................4
PESTLE Analysis........................................................................................................................4
CONCLUSION................................................................................................................................5
REFERENCES................................................................................................................................6

INTRODUCTION
Businesses in the market must understand and analyse the external and internal factors in
the market so that there is going to be effective working. Lego was named in 1934 and this group
of Lego started in a workshop of Ole Kirk Christiansen. The following report will be discussing
the external factors of the organization so that there is better planning which can be done.
QUESTION 1
Importance for business to practice CSR
There has to be ethics operate transparency and fairly business in the market therefore it
is very important for the company to have CSR practices in the company as well. The
environment has to be protected and support worthy causes in the world so that the brand
reputation and value in the market can increase.
QUESTION 2
Advantages and disadvantages of Lego responding to call of change by children
Advantages
There are more queries which the customers can have for the activities which the
organization is having for the children so that there is going to be good mental development
which would be present. Any small misunderstanding can be harmful for the organizations
reputation.
Disadvantages
It is very important for Lego to give out guarantee for the quality of products and services
they are providing in the market so that the organization will be able to operate effectively.

QUESTION 3
PESTLE Analysis
The external factors are not in control of the business but the external factors can impact
the company majorly which needs to be monitored and controlled. The following report is going
to discuss the factors which may impact the company’s decision making.
 Political factors
The political factors in the country are stable but the company will have to make sure that they
are following all the policies and laws which are present in the market so that there can be higher
functioning (Santander and et.al., 2020).
 Economic factors
The unemployment rates and GDP globally is improving of a lot of countries which is why
the pricing of the products of Lego can be priced accordingly which would make the profit
margins of the organization increase. The company can further expand themselves globally in
developing countries especially so that the organization will be able to benefit.
 Social factors
The lifestyle of the customers is changing and there are a lot of activities which the parents
are providing to the children so that they can grow mentally at the right age (Wade and Piccinini,
2020). The company is being able to maintain that demand of the customers and more products
are coming up by the organization so that they can gain the loyalty of the customers.
 Technological factors
Use of right technology is very important in the organization so that there is going to be
higher standards and quality maintenance would be present which is going to be a great factor for
the company to have in this competitive market.
 Legal factors

There are a lot of laws and regulations which are present for the right of the customers and
employees which the company will have to implement and adopt to so that there is going to be
higher satisfaction and productivity by the workforce which is going to be present for the
organizations long run in the market.
 Environmental factors
The company is having zero carbon footprints measures which is being followed in the
company since there is plastic in the company. The company will have to invest a lot in this
factor in order to make sure that the reputation and branding of the company does not get
affected (Curtis, 2016).
CONCLUSION
From the above report, the company will have to make sure that they are analyzing the
market effectively so that they can avoid the further risks and damage to the organization. It is
very important for the company to be able to operate effectively which would be a great factor
for the company’s reputation and brand value in the market.

REFERENCES
Books and Journals
Curtis, V., 2016. Small Business For Dummies-Australia & New Zealand. John Wiley & Sons.
Santander, P and et.al., 2020. Closed loop supply chain network for local and distributed plastic
recycling for 3D printing: a MILP-based optimization approach. Resources,
Conservation and Recycling. 154. p.104531.
Wade, B. and Piccinini, T., 2020. Teaching Scenario Planning in Sustainability Courses: The
Creative Play Method. Journal of Management Education. 44(6). pp.699-725.